The Turkish lira plunged further on Friday, losing as much as 6 percent of its value, Reuters reported.
The currency was trading at a new record low of 16.69 against the dollar by 1004 GMT, the news agency said.
The lira has lost more than 50 percent of its value this year, including 50 percent in the last 30 days alone, after the central bank began cutting interest rates at the behest of Turkish President Recep Tayyip Erdoğan.
The central bank reduced interest rates again yesterday after its Monetary Policy Committee opted to lower the benchmark rate from 15 percent to 14 percent despite growing concerns about inflation.
Consumer price inflation accelerated to 21.3 percent in November and is expected to rise further in coming weeks, eroding the pay and savings of ordinary citizens.
However, Erdoğan has pushed the unorthodox economic position that higher interest rates fuel price rises while warning that Turkey must seek to reduce its dependence on foreign investment.
Last month, the Turkish president said his country faced an “economic war of independence,” according to pro-government newspaper Daily Sabah.
“With Erdoğan seemingly becoming more entrenched in his anti-interest rate stance, the longer the currency crisis lasts, Turkey could be beyond the point of no return,” Patrick Curran from Tellimer told Reuters.
“As long as Erdoğan is at the helm there is nothing to prevent the lira from continuing to depreciate,” he added.