Turkey"s central bank chief signalled on Thursday that aggressive policy easing would likely pause in January after one more rate cut this month, according to participants on an investor call, following an historic selloff of the lira. Turkish President Tayyip Erdogan separately chose Nureddin Nebati, a strong supporter of his low rate policy, as treasury and finance minister overnight after Lutfi Elvan, who was seen as having more orthodox views, resigned the post. read more The lira fell a further 3.5% to reach 13.9 versus the dollar at 1559 GMT, near Tuesday"s record low of 14.0, though at 1642 GMT it was off that low at 13.6750. The slide came after Turkish daily Cumhuriyet reported that the Council of Europe"s (CoE) Committee of Ministers had decided to launch "infringement proceedings" against Turkey over its failure to release philanthropist Osman Kavala, in line with a European Court of Human Rights ruling. A CoE spokesman contacted by Reuters could not confirm the reports but said the decision would be published on Friday. The lira had steadied after the central bank intervened on Wednesday to calm "unhealthy" market moves. It is down 44% since the start of the year, and S&P told Reuters that Turkey"s monetary policy stance and its use of "borrowed" reserves to defend the lira posed a risk to its sovereign rating. read more RATE CUTS The lira selloff has been driven by a series of rate cuts to 15% from 19% in September - even as annual inflation hit 20% and is expected to near 30% next year after the lira depreciation. Economists have widely criticised the stimulus as reckless. Opposition politicians have called for snap elections to reverse course, and Turks say the currency plunge and soaring prices have upended household budgets and future plans. read more On the monthly conference call, Central Bank Governor Sahap Kavcioglu - appointed by Erdogan in March - told local investors there was some limited room for another rate cut this month, four participants told Reuters. "I got the impression that he will pause (easing) and watch for some time in 2022 after a final limited cut in December," said one participant who requested anonymity. Kavcioglu signalled the bank was "almost done for the time being", said another participant on the call, which was closed to the press. In its policy statement last month, when it cut rates by another 100 basis points, the bank said it would consider using its "limited" room for more easing at its Dec. 16 meeting. Turkish bonds have risen despite the rate cuts, suggesting traders expect a central bank U-turn. Money markets are pricing in a policy rate rise to 24% over the next year , and that it will stay above 22% for years. "I see Erdogan is panicking over (how) to reconcile his voter base" ahead of elections in 2023, said Burak Bilgehan Ozpek, political science professor at TOBB University in Ankara. EXPECTING "A MIRACLE" "People around Erdogan expect a miracle from him ... but this time it"s different, because economics is a more rational, mathematical thing and does not heed miracles," he said. "There is no hat, and there is no rabbit to pull out." Erdogan, Kavcioglu and Nebati have said monetary policy must boost investments and exports. The president, who has seen his poll ratings slide, has rapidly overhauled the central bank"s leadership and pressured it to cut rates. read more Elvan, the former finance minister, asked to be "released from his duties", the Official Gazette said, following on the heels of other officials at the central bank and elsewhere who disagreed with the direction of policy. Nebati, who was previously the deputy finance minister, said on Thursday that "chronic issues" such as foreign debt must be tackled. "Our most important priority will not be high interest rates," he said. read more Additional reporting by Can Sezer in Istanbul, Ece Toksabay and Tuvan Gumrukcu in Ankara and Marc Jones in London; Editing by Dominic Evans, Daren Butler and Gareth Jones