The Turkish lira fell today and headed to significant weekly decline as this week’s interest rate cut by the nation’s central bank reduced attractiveness of lira-denominated bonds.
The yield on Turkish debt maturing in two years fell to the record low of 5.67 percent yesterday. The Turkish central bank explained its recent rate cuts by concern that the overvalued currency had led to increasing current-account deficit. The lira was also weak as the last minutes of the Federal Reserve’s meeting spurred risk aversion on the Forex market, hurting currencies of emerging economies. The currency has declined 1.5 percent over this week.
USD/TRY went up from 1.7943 to 1.7963 as of 15:25 GMT today.
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