USD/TRY: Lira shrugs off Erdogan’s resistance to the rate hike – Commerzbank
|Turkish President Erdogan mentioned that the country did not need to hike interest rates. These remarks have no implications for the lira, in the view of economists at Commerzbank.
Erdogan reiterates case against rate hikes
“President Tayyip Erdogan’s repetition that there is no case for rate hikes in Turkey hardly has implications for the exchange rate. Even if his remarks might mean that CBT will be under pressure to cut the rate again in the coming months, that too, should come as no surprise.”
“Erdogan is emphasising rapid investment as the way to tackle inflation. This is anyway a longer-term strategy. But crucially, Turkey needs substantial foreign capital to bridge the gap between the required investment rate and Turkey’s own low savings rate. But perhaps that too will be clear only over the longer-term. For now, we see no implication for the lira.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.