<p><strong>Turkish President Recep Tayyip Erdoğan insists that the country’s runaway inflation can be controlled by decreasing the nominal interest rate. But, given Turkey’s current strategy for financing growth, there are clear reasons why eschewing economic orthodoxy will only wreak further havoc with prices.</strong></p>

Until pandemic-related disruptions to supply chains and labor markets began fueling rapid price growth, inflation was well below target in major economies, and, sooner or later, the question of what to do in such situations will return.

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