Turkey Has Two-Headed Government, One Central Bank Chief to Pick

President Recep Tayyip Erdogan is at loggerheads with his premier over who should be the next central bank governor as the Turkish president pushes for a candidate amenable to cutting rates, according to people familiar with the matter.

Less than a month before the term of central bank Governor Erdem Basci expires, Prime Minister Ahmet Davutoglu and his deputy, Mehmet Simsek, want a governor who can win investor confidence with orthodox monetary policy. Erdogan and his allies are seeking someone who shares their view that Turkey needs lower borrowing costs to curb inflation, fuel investment and boost growth, the people said, speaking on condition of anonymity to discuss private debates. The two leaders must each sign off on a candidate.