“Danger here is that Turks borrow cheaply in lira and then deposit in these FX indexed accounts.“ They also passed a bill previously which said that they are planning to observe borrowers and what they do with that money. There are also a lot of people who got screwed over by the government’s policies whether it’s real estate, healthcare, education etc. all because of promises that were too good to be true. I believe this new legislation falls into that category as well. Moreover, for these new FX indexed accounts to work properly FX/TRY needs to increase more than the interest rate which will be ~12% probably. This is too complicated and super counterintuitive to the average person, hence I probably will transfer my USDs and EURs to Forex, as far away from Turkey as I can. In conclusion this will fix the FX rate but to a point much higher than it could have been if only these mental gymnastics were avoided.
“Danger here is that Turks borrow cheaply in lira and then deposit in these FX indexed accounts.“ They also passed a bill previously which said that they are planning to observe borrowers and what they do with that money. There are also a lot of people who got screwed over by the government’s policies whether it’s real estate, healthcare, education etc. all because of promises that were too good to be true. I believe this new legislation falls into that category as well. Moreover, for these new FX indexed accounts to work properly FX/TRY needs to increase more than the interest rate which will be ~12% probably. This is too complicated and super counterintuitive to the average person, hence I probably will transfer my USDs and EURs to Forex, as far away from Turkey as I can. In conclusion this will fix the FX rate but to a point much higher than it could have been if only these mental gymnastics were avoided.