The lira extended its loss against the dollar on Tuesday. The battered currency last week posted its worst weekly performance since July 21 and has lost over 7% this year, according to Bloomberg.
But Turkish Finance Minister Mehmet Şimşek sought to calm markets by suggesting that the recent volatility in the exchange rate, driven by soaring inflation and declining reserves, should be seen as temporary.
Inflation in Turkey rose to 67.07% last month, the highest in 15 months, smashing expectations and reigniting currency risk fears. That came after central bank kept the key interest rate on hold.
The country’s financial standing has received a boost as Fitch Ratings on Friday upgraded the long-term foreign-currency issuer default rating to “B+” from “B” while also revising the outlook from “stable” to “positive.”
President Erdoğan has voiced confidence in the government’s anti-inflation measures taking effect by the end of the year. He appointed a new cabinet and central bank leadership after his re-election last year.
Turkey is preparing for local elections at the end of March. The ruling party wants to recapture major cities such as İstanbul and Ankara, which are currently controlled by the opposition.
The lira is in free fall in the long term. Technical indicators have proved ineffective in predicting a turning point. Unless Turkey manages to rein in inflation, buying the dip is highly risky.
EBC Financial News Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC Financial News or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
風險提示：本文所述僅代表作者個人觀點，不代表 Followme 的官方立場。Followme 不對內容的準確性、完整性或可靠性作出任何保證，對於基於該內容所採取的任何行為，不承擔任何責任，除非另有書面明確說明。
暫無評論，立馬搶沙發