Turkish lira hits record low after cabinet reshuffle

The Turkish lira hit a fresh record low on Thursday following a cabinet reshuffle by Turkish Prime Minister Recep Tayyip Erdogan amid a huge graft scandal. The lira fell to 2.1035 against the dollar on Thursday, after starting the day at 2.0914. On Wednesday three top ministers whose sons have been caught up in police anti-corruption raids announced their resignations, with one calling on Erdogan to also step down in the first such challenge to the prime minister from within his own ruling Justice and Development Party (AKP). In response to the escalating crisis, Erdogan announced a long-expected cabinet reshuffle and named 10 new ministers -- almost half of the cabinet. The renewed political crisis ended a brief reprieve for the lira. It had strengthened to 2.0650 following an announcement by the central bank on Tuesday that it would ramp up its support for the unit by selling at least $6 billion in foreign currency by the end of January. The lira has also been under heavy pressure this year in expectation of the US Federal Reserve's decision to reduce its stimulus measures. As a leading emerging economy, Turkey has been one of the main beneficiaries of the Fed's stimulus as US investors sought higher returns abroad. The Istanbul stock market also dropped by 1.8 percent to 64,904 points on Thursday.