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Multiple Turkish lira exchange rates continue to soar

Since mid-November, two currency exchange rates, USDTRY (US Dollar to Turkish Lira) and EURTRY (Euro to Turkish Lira), have consistently featured in AvaTrade’s weekly most rising table. The exchange rates have seen significant price increases in four out of the five past weeks. For example, USDTRY took first place on our most rising table for the weeks commencing 22nd November and 20th December, with EURTRY in second place during those weeks.

“The currency crisis currently plaguing the Turkish lira means that two currency exchanges rates, USDTRY and EURTRY, have continued to perform incredibly well over the course of the past month,” said Naeem Aslam, Chief Market Analyst, AvaTrade. “The Turkish lira, which has been one of the worst performing emerging market currencies throughout the year, has taken a further hit in recent weeks. The Central Bank of the Republic of Turkey (CBRT) has continued to slash interest rates, doing so on a regular basis since the middle of November – and four times in the last two weeks alone, thanks in no small part to pressure from the Turkish president, Recep Tayyip Erdoğan.”

“In fact, the situation is so bad that the central bank has needed to intervene in the market twice in recent weeks, citing ‘unhealthy price formations’ in forex markets, while Lütfi Elvan, the former finance minister, resigned at the beginning of December. Despite all of this, Erdoğan is showing no signs of altering his economic policy, continuing to push for low interest rates, as he tries to reduce borrowing costs in an attempt to stimulate the economy, as well as increase growth and exports. This is despite the fact that inflation is continuing to rise, with the currency itself in free fall,” Mr Aslam added.

This was posted in Bdaily's Members' News section by AvaTrade .