Turkish central bank’s rate decision is unlikely to have an impact on the lira, in the opinion of economists at Commerzbank. TRY is set to suffer another round of selling pressure.
High inflation rates and the dollar are the driving forces in USD/TRY
“The lira’s cautious reaction to the August decision illustrated that the market has given up hoping for monetary policy to support the currency. That means today’s decision is unlikely to have much of an effect on the TRY exchange rates either.”
“High inflation rates and the dollar are the driving forces in USD/TRY. Due to the continued high levels of foreign debt, we still do not consider simply accepting TRY depreciation to constitute a sustainable strategy. As a result, the next TRY crisis is only a matter of time in our view.”
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