ISTANBUL: The Turkish lira firmed against the dollar in early Thursday trade after hitting a record closing low of 8.9490 amid worries over President Tayyip Erdogan's influence on monetary policy after last week's unexpected interest rate cut.

The lira stood at 8.91 against the US currency at 0512 GMT. It has weakened nearly 17% so far this year.

The central bank lowered its policy rate by 100 basis points to 18% last Thursday, despite headline inflation of 19.25%. The bank will release the minutes of last week's meeting at 1100 GMT.

Turkish lira trades near record lows after last week's rate cut

The dollar hovered near a one-year high versus major peers on Thursday, following a two-day surge amid expectations for a tapering of Federal Reserve stimulus from November and a possible interest rate hike in late 2022.

Turkish Central Bank Governor Sahap Kavcioglu was quoted as saying on Monday the reason for most of the lira's depreciation this month was statements by the Federal Reserve, adding there were no grounds for the currency to see further sharp falls.