USD/TRY bounces off lows, around 4.7200
|- The Turkish Lira loses some ground around 4.7200.
- The pair trades below recent all-time tops near 4.9300.
- The CBRT hiked the LLW by 300 bps on Wednesday.
The Turkish currency is trading on the defensive at the end of the week and is now taking USD/TRY to the 4.7200 region after bottoming out in sub-4.6900 levels during early trade.
USD/TRY lower post-CBT move
After clinching new all-time highs in levels just shy of 4.9300 the figure on Wednesday, the Turkish central bank (CBT) hiked the Late Liquidity Window (LLW) lending rate by 300 bps late on Wednesday - taking it from 13.5% to 16.5% - in a desperate attempt to prevent a deeper crisis in the currency.
Since then, TRY has managed to stay rangebound in the upper end of the range, although it remains vulnerable amidst a strong greenback, higher crude oil prices, domestic economic uncertainty and political effervescence ahead of the key elections on June 24.
It is worth mentioning that the central bank justified the recent move on rates on the prospects of higher inflation and rising inflation expectations. In addition, the CBT said it will keep the tight monetary conditions until the inflation outlook shows some ‘significant’ improvement.
USD/TRY key levels
At the moment the pair is up 0.60% at 4.7373 facing the next hurdle at 4.8030 (high May 25) seconded by 4.9282 (all-time high May 23). On the flip side, the next support is located at 4.6895 (low May 25) followed by 4.5568 (10-day sma) and then 4.5416 (low May 23).
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