ISTANBUL — The Turkish lira continues its downward slide against major currencies, hitting record lows of 7.63 per US dollar and nearly 9 per euro as of Monday afternoon. The losses come ahead of a highly anticipated Central Bank meeting Thursday in which few analysts expect policy-makers to reverse an easing cycle that’s kept borrowing costs below inflation.

The lira has lost about 21% of its value against the dollar this year as the COVID-19 pandemic continues to impact economies around the world. To date, the Central Bank has resisted pressure to raise key interest rates, instead utilizing “backdoor” tightening policies that have raised weighted-average borrowing costs for funding.

Since taking office in July 2019, Turkish Central Bank Governor Murat Uysal has repeatedly slashed key interest rates, in line with the unorthodox monetary policies advocated by Turkish President Recep Tayyip Erdogan, who maintains that high interest rates increase inflation.

“I believe the recent weakness in the Turkish lira reflects the upcoming Central Bank meeting and concerns regarding its independence,” Selva Demiralp, a professor of economics at Koc University and director of the Koc University-TUSIAD Economic Research Forum, told Al-Monitor.