Turkish Lira- Recent example of hyperinflation..

How the Turkish Lira Lost Its Value — And What It Meant for Turkish Savers

Over the past four years, the Turkish lira has suffered a dramatic decline in value. The currency has fallen sharply against major currencies as Turkey experienced very high inflation and prolonged pressure on its economy. The lira lost 29% against the US dollar in 2022, another 37% in 2023 and 16% in 2024.

The decline is also visible when comparing the lira with the Indian rupee. In early 2019, 1 Turkish lira was worth around ₹12, while today it is only around ₹2. That means the lira has lost roughly 6 times value against the rupee in about six years.

The bigger problem for ordinary Turkish citizens was inflation. Turkey's annual inflation reached 85.5% in October 2022, while inflation remained extremely high through 2023 and 2024. Even as inflation has fallen, it was still around 31.5% in August 2026.

This created a painful situation for people who kept most of their wealth in Turkish lira cash or bank deposits. Imagine someone who had 1 million lira in cash in 2022. The number of lira would still be 1 million, but its international purchasing power and ability to buy imported goods would have fallen substantially. At the same time, prices inside Turkey rose rapidly, meaning the real purchasing power of those savings also declined.

Turkey introduced a foreign-exchange-protected deposit scheme to protect some lira savings from currency depreciation. At its peak, the scheme covered around $140 billion of deposits, showing how concerned savers had become about protecting their wealth.

The Turkish experience is a powerful reminder that saving money is not the same as preserving wealth. If a currency loses value faster than the interest earned on savings, people can see their purchasing power decline even though the amount in their bank account continues to increase.

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