USD/TRY set to test new highs in the second quarter of 2021 – Credit Suisse
|Economists at Credit Suisse remain bearish TRY and are looking for a test of 8.58 in the USD/TRY pair.
The share of households’ FX deposits is around multi-year highs but it has been trending higher
“Since late March elevated FX implied yields and possible FX selling by state-owned banks have eased the pressure on the lira and allowed range-trading in USD/TRY between 8.00 and 8.40.”
“Renewed sources of USD-demand are likely to put pressure on the lira in Q2. Further increases in households’ FX deposits are possible as the outlook for real rates has deteriorated and corporates will need to buy USD in case external debt rollover ratios fall below 100% (like they did in 2020). Against this backdrop, we see a high-likelihood that USD/TRY will break above its all-time high from November (of 8.58) in Q2.”
“The central bank’s rate decision next week (15 April) is the main near-term risk-event to watch.”
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.