TRY expected to come under pressure medium term – Danske Bank

In opinion of Aila Mihr, Analyst at Danske Bank, sees the Turkish Lira coming under renewed pressure in the longer run.

Key Quotes

“Yesterday, Turkey's central bank kept all rates unchanged, as expected by us and Bloomberg consensus”.

“It was a fully justified decision as headline inflation accelerated in August. TRY remains the most attractive carry in FX and unchanged rates push TRY higher”.

“While we expect that the key rate stays unchanged in 2017, monetary easing will start in H1 18, leaving TRY wounded in the medium and long term as the current account balance remains deeply negative and the surging oil price is not bringing relief to that”.

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