Capital controls not on agenda in Turkey, says senior govt official

ANKARA (REUTERS) - Turkey is not considering any sort of capital controls as it battles to defend the lira, a senior government official said on Thursday, after Prime Minister Tayyip Erdogan said an "out of the ordinary" economic package could be announced soon.

"We are not working on capital controls and it is not on the table," the official told Reuters.

Turkey's central bank raised all its key interest rates at an emergency policy meeting late on Tuesday, ignoring opposition from Mr Erdogan as it battled to defend the lira following its fall to a series of record lows.

Mr Erdogan, keen to maintain growth ahead of an election cycle starting in two months, has frequently railed against what he describes as an "interest rate lobby" of speculators seeking to stifle growth and undermine the economy.

Asked if he had an alternative strategy to higher rates, Mr Erdogan was quoted by pro-government newspaper Yeni Safak late on Wednesday as saying work on "a Plan B or a Plan C" may be announced in the coming days or weeks.

"We want it to be something out of the ordinary. Globally there are practices," he said, without giving any details.

"But at a time when the central bank has taken this step it would not be right for us to announce this ... It falls to me to be patient for some time. We have to see where we are going."

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