- The Turkish lira is down widely against the dollar.
- Geopolitical nerves continue to put additional pressure on Ankara.
- Widespread disappointment over the recent CBRT decision weighs heavily on TRY.
The Turkish lira falls to new lows against the dollar and pushes the USD/TRY to new all-time highs near 8.10 at the beginning of the week.
USD / TRY aware of geopolitics, CBRT
USD / TRY rises on Monday following renewed geopolitical concerns surrounding Ankara in the context of mounting US and EU sanctions bets against the country. It is worth remembering that Turkey faces conflicts against Greece in the eastern Mediterranean and the Caucasus amid the Armenian-Azeri dispute.
Furthermore, market sentiment around the lira remains bitter as market participants continue to take in last week’s (big) disappointment from the Turkish central bank (CBRT) after it dropped the buyback rate of a week unchanged at 10.25%.
Adding pressure to the already fragile monetary scenario in Turkey, state lenders sold more than $ 400 million earlier in the week in an unsuccessful effort to support the beleaguered lira.
It is worth noting that the lira has depreciated almost 27% so far this year.
Technical levels
At the moment, the pair is gaining 1.75% at 8.0835 and facing the next hurdle at 8.0964 (all-time high on Oct 22). On the downside, a drop below 7.7787 (Oct 22 low) would expose 7.6294 (Oct 1 monthly low) and finally 7.5945 (55-day SMA)
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Credits: Forex Street
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