the floor, the subs disappeared on sunday, off of the canadian coast next on the w to some news from the business world. so to stay with us, if you can for that my colleague stevens here as they will join you. i'm sarah kelly and for land. thank you so much for watching. take care the doors, the scoring we say they were about never giving up sports like every weekend on

dw, the discovery change your mind. just click away, find out best document, freeze on you to see the world, the subscribe. now to dw talking entry, the is turkey. finally putting the brakes on its own orthodox interest rate policy. the central bank there raises rates for the 1st time and more than 2 years. a period in which inflation has rocked its currency inmate everyday life on affordable for many turks. also in our show, the us rolls out the red carpet for indian prime minister,

no bridge remoting will definitely be the business partners of many see eco's and vision. obviously there's an invalid. welcome to our program for the 1st time and almost 2 and a half years. turkey central bank has raised interest rates to 15 percent from just under 9. it's a shift away from the unorthodox policies are present, rest of type, everyone who has champion low rates. despite the turkish lawyers rapids about the valuation. the country's currency was have had serious consequences for normal turks. as their correspondent, julia han reports. there is almost nothing you can find here in the immuno. no. the neighborhood is one of the symbols oldest and busy a small because the area and it's seen as a bell with us for the talk. is she calling to me? right now, it seems. need a sharp luminous new customers, happy to smaller sales have dropped by 50 percent. the price increases every day

and the exchange rate fluctuates. the, this is giving us a hard time custom us. we used to buy a kilo only know buying house, aquino, or even less because it is a good one. what do you face to activate? my expectation is that the economy will improve that inflation will disappear, but i don't think it will the positive. i just hope it won't get even worse to accept that we have been struggling with this crisis for a long time and we've been very patient. it's time for things to get better. since president ridge of telling you about 11 re election in may, the value of the talk is really robust, tumbled to news. and inflation is officially me a 40 percent, leaving many unable to afford even basic food stuff. analysts say president ad ones and also talks economic policies have made things worse, especially his insistence on low interest rates when inflation is running high. now

he's appointed a new economic team to overcome the crisis. how fees ago? yeah, our con, a former will street executive is talk, he's new central bank of a new finance minister may have met him check. an internationally renowned economist has pledged to return to rational policies, use it to find information that the security expert like olds on chicago. however, remain cautious. even if the new team were to convince our line of a policy shift, he says, talk, he's economy wouldn't just switch, play, recover, lost. it's been, goes to camps. the problem is that all right, cool. now it has been the radio so much in the last few years that are not easy or quick fix this 3. it will take many years to fix and whatever you do, it will be very painful. if you have to increase interest rates to lower inflation . we will be faced with a huge risk of very high unemployment survey this the public and the president will

actually have the patients to see through this thrust formation. yet it remains yet to be see here at the market in any news. no one wants to hear about more economic pains. people want prices to go down and the economy to heal. so things might get more difficult before they can get better. and then use now confirming that monetary policy shift to counter sky high inflation here into a key that has left so many people struggling to get by the key interest rate was heights to 15 percent. maybe not to the degree. some analysts had expected, but it seems more increases all on the horizon, and that is why many economists here in the country see this as a 1st step in the right direction. finally, signaling

a return to wood more conventional conventional economic policies. timothy ash is an economist at blue bay asset management in london, and he's an associate fellow, a chatham house. 10, thanks for joining us. rates looked at the 15 percent. i think you were expecting a lot more weren't you out? how do you look at this? what, what's happened? well, he places 40 percent, so 50 percent policy rights means negative 25 percent real rates hops. the coupling flows with, with such large negative real rates taking how's the balance of payments? problem, lots content that's it needs to close the how does it close it? you know, if it's not really high rates, it's got to let the count see it just an attrition check is just that's the finance ministers just come out just now saying that he thinks the ethics regime will attract effects in flows or capital inflows. i should say a suggest they're going to let the exchange rate relative to the interest rates do the heavy lifting, incentive, closing the trade and current account deficit? do you consider this a turnaround for turkey?

is monetary policy in any degree, or is this sort of a slow difference of the water as well? i mean it on to be in the route to elections. they manage the exchange rate. they tried to keep as a no been line. um, at least in a couple of months or 6 months as a leading up selection price have out, they had lots of devaluation because of ad one's crazy interest rate policies. i think we got now going to see a bit of both. right. we're going to see the currency allowed to adjust, and we're going to see some rate hikes to kind of bodies, the inflation effects of, of thought. so we could cover this in the past through to inflation from an exchange rate week. this combination of both market probably wants much more pre from loading of, of rate hikes. remember, here is the memory, the publishing check of the new governor a come have is the market. remember as a previous orthodox governor? no, she act ball who high rates and was removed kind of 6 months into into the jump so that i know of us about the novice, the basically you actually, i'm checking that can, may, will also it's policy an organization rights. but actually they want me to jump very long. so that's the real difficulty. if you're

a normal to what does this decision mean for you and these, these several decisions that we've seen so far? well, credit is going to be still hard to get. so i think with, with such negative rates, the count see it will adjust weak shots and probably means inflation, which is from a high base come as come down a bit. remember it is 80 percent 6 months or so down the line. it's come down to around 40, i think the problem really, it probably stick around this level, maybe go bits higher until we see some re balancing on the current account, helping on to the exchange rate. and then maybe we'll see some by then usually inflation from the probably like 6 to 12 months down the line. but all the way i wanna make sure that understanding you do not really see this as a complete turnaround by error one. he's also with one calling the shots. as you mentioned, the markets have a memory of what's happening to previous governors. is this much of a, is this sort of a trial balloon and it could always be yanked away as well. we'll have to see if this is different. as i mentioned, the previous experience was, was not jack bell. he went to all the docs, the height, right? single, fired, 6 on the thing to the jump. a guy i tend to think that is

a different crew with advises around ad one and they pushing them all off adults agenda and drove the appointments or shoot. check on subject is fine as mr. and kinda as governor, and perhaps, you know, i'm hopeful that we'll see this, this move back to some kind of all for the oxy sustaining longer than last time. so, you know, i'm a bit more hopeful, but, you know, unfortunately the track record of ad one is in is intervening and monetary policy. that's the, comes to timothy ash with blue bay asset management in london. thank you. oh, my pleasure. was that interview recorded earlier in the day? let's move on out of some of the other little business tories making headlines. the bank of england has raised its key interest rate from 4 and a half to 5 percent in an effort to battle. the countries stubbornly high inflation is the 13th consecutive break, high bringing borrowing cost to a new 15 year high inflation, u. k. so the 8.7 percent in may, which is among the highest levels of g 7 nations. german exports to countries

outside the european union increased by one percent in may fall in 2 months of declines. your largest economy exporting goods worth more than $59000000000.00. the most important export markets where the us in china will trade with russia continue to decline sharply. panama worst route on record threatens to strain global water supplies as water levels in the panama canal, or at their lowest level of forty's, impose travel restrictions to prevent larger container ships running a ground meeting. many of them will have to carry less cargo indian prime minister and arrange remote. he is in washington for state visit, where he's been inking new industry and defense deals, including one for g, e to build jet engines for the indian military. also on the agenda is a major deal for semi conductor trips and a joint mission with nasa scheduled for next year. the u. s. as in india, as an economic and political counter way to china, bodies and do nationalism remains of concern. however,

for many us part politicians what it was once banned from entering the us on allegations he supported religious ban rights. while he was head of the state, of course, you're right. and we go to actually touch pandey for more on this ashtosh. this is bodies, the 1st state visit to the us. he's meeting with c o is he's addressing congress. how important is india right now for the us, not just politically, but also economically. it is extremely important stephen and, and that's because the india has a much as a key or tentative to china as companies look to diversify the from china as part of the china plus x strategy. it for them. india is a political or stable country. it's offering believes and incentives who come on making india also the fastest growing media economies. so there's a lot for them to be really excited about as far as india is concerned just this week, i long must said, but that's what i was looking to invest a, make a significant investment in india as soon as possible. just today, the hard,

the agenda electric has agreed to join to the manufacturer of fi to jet engines in india and all the despite the despite bodies around democratic back sliding in india under more these watch the challenges and firms investing in india as opposed to say, in china were often said to be infrastructure, lack of educated workers, too much bureaucracy, even to what extent are those still the challenges that are facing for an investment. but that's an interesting question, steven. so if we look at the investments that have come or that have been announced in recent times, they've been mostly restricted to the computer and electronic sector. so the likes of apple folks go on to the high tech industry and do this. and the main job creator in india and other industrial manufacturing, it seems like tech style food and food and beverages. these companies haven't really been getting as much attention. and that's because of the many of the reasons that you've just mentioned, a lack of interest structure, lack of skin, do

a workforce and and also the fact that there is high titus in india and, and that the reason why they haven't really seen that much of a interest having said that, the move, the government is investing big time into uh, an infrastructure building, the roads, an apple with that being built as a court pace that could be taken care of. the problem is creating skill level for us because the problem is a problem with the education level and that needs to be type in as quickly as possible. all right, i should talk monday. thank you bye. this is a reminder for top business stories. 30 central bank is high interest rates significantly to 15 percent in an effort to rain in the country. scott high inflation to move represents a policy shift for turkish president present type air to one who as long resisted higher rates against the judgment. economists as our show for more fun is on line, the w. com slash business. we're also on youtube, part of the deed of news channels. i'm seeing there is

a blend the center of the conflict with tim sebastian america, the secretary of state down to the clinton was finally engaging in the long delay that's. that's a whole slide and us china relations. the main sticking point is go tie one. i guess going to pay is the time of these 4 minutes. joseph the island living on the conflict on d. w. to the point clear position, international perspective. china has not changed its position neither on ukraine nor on 5 on. and yet, china is trying to win friends, can mutual trust,

be established again? on to the point we all china, global i'm vision comes with the w. we've got some hot tips for your bucket list, the magic corner check hot spot and some great culture on the board has to vote w travel off we go. the, the american secretary of state down to the lincoln was finally engaging in a long delay. the effort to hold the slide in us china relations. the main speaking point is still tie one with the chinese determined to be unified and warning the west to stay out of the cool interest. my guess inside pay is the time when these foreign minister joseph would.