- USD / TRY hits a new all-time high near 10,600.
- The lira depreciates further after Erdogan’s comments.
- The CBRT meets Thursday and could cut rates further.
The lira continues to suffer and continues in free fall, pushing USD / TRY to new all-time highs at 10.5583 on Wednesday. Then there was a pullback and it is trading at 10,477. From the level of a week ago, the dollar rises more than 6% against the Turkish lira
USD / TRY supported by the collapse of the lira and general strength of the dollar
USD / TRY extends the rally for another session on Wednesday against a background of widespread dollar strength and with the continued collapse of the Turkish currency ahead of the key meeting of the Central Bank of the Republic of Turkey (CBRT) on Thursday.
Turkey’s President Erdogan’s comments on Wednesday did not help. He claimed that inflation is the result of high interest rates, adding that he will not allow people to get crushed by rates and that he will not agree with interest rate advocates. Erdogan’s comments not only appear to have precipitated the lira’s slide, but could also have paved the way for another reduction in the referencai (one-week repo) rate at the CBRT meeting on Thursday.
The consensus on the next CBRT move now seems somewhat divided, as many think that the recent collapse of the lira could motivate the central bank to take a break from the bear cycle.
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.