USD / TRY rises further and approaches 10.0000

• USD / TRY extends the rally near 10.0000.
• It loses about 25% against the dollar so far in 2021.
• The CBRT meets on November 18 and could cut rates further.

The Turkish lira depreciates to new record lows against the dollar and pushes the USD/TRY near the key psychological level of 10.0000 on Thursday.

USD / TRY: The 10.00 level is just around the corner

USD / TRY is advancing for the third consecutive session so far this Thursday against the backdrop of the relentless upward movement of the US dollar.

In fact, the price recently accelerated after higher-than-expected US inflation figures for October (released Wednesday). The US CPI report quickly ignited speculation about a more accelerated funding cut by the Fed, exactly the opposite situation to what is happening in Turkey.

In fact, the Turkish CPI rose to almost 20% in October compared to the same month of 2020 and the Turkish central bank (CBRT) surprised the markets with a shocking 200 basis point reduction in the one-week buyback rate.

That said, while the next CBRT meeting on Nov 18 is still a close call (ish), another interest rate cut by the central bank should come as no surprise and could open the door for USD / TRY to challenge … the moon ?.

Technical levels

So far, the pair is gaining 0.71% to 9.9125 and a drop below 9.5581 (20-day SMA) would expose 9.4722 (November 2 monthly low) and finally 9.4128 (October 26 weekly low). On the other hand, the next ascending barrier lines up at 9.9723 (all-time high on October 25) followed by 10.0000 (psychological level).