USD/TRY EXTENDS THE MARCH NORTH TO THE VICINITY OF 23.4000

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The continuation of the intense sell-off in the Turkish lira lifts USD/TRY to a new all-time peak near the 23.4000 mark on Thursday.

USD/TRY risks a deeper pullback

Gains in USD/TRY continue to accelerate on Thursday, as the pair has already advanced around 12% since the opening bell on Monday and following the appointment of M. Simsek as Treasury and Finance Minister (on Saturday).

Indeed, the bearish tone in the lira remains everything but abated in a context where market participants keep monitoring the "intentional devaluation" implemented by the new economic team designated by Erdogan’s administration in the wake of the victory in the May 28 elections.

In the meantime, the sharp retracement in the lira gathered extra pace after national lenders stopped selling US dollars to defend the currency this week, a move deemed quite rational and more in line with economic orthodoxy.

So far, the Turkish currency has already depreciated over 25% since the start of the new year, while the drop has reached more than 170% since the Turkish central bank (CBRT) embarked on its easing cycle in August 2021


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