- USD/TRY extends the upside to the 21.5000 region.
- There seems to be no respite for the lira meltdown so far.
- Inflation in Türkiye dropped below 40% YoY in May.
Further weakness in the Turkish currency props up a new record high in USD/TRY, this time hitting the 21.5000 zone on Tuesday.
USD/TRY: Next target… the moon?
USD/TRY keeps the march north unabated, in the meantime, as investors continue to dump the lira following President Erdogan’s win at the general elections on Sunday and despite the appointment of well-known orthodox M. Simsek.
Recently, finmin Simsek emphasized the crucial importance for Turkey to bring down inflation to single digits once more in the medium term. Additionally, he stressed the need to accelerate the process of structural transformation, which would help alleviate the current account deficit.
It is worth recalling that Monday saw the CPI rise 39.59% YoY in May and 0.04% vs. the previous month.
The lira has lost already more than 15% since the beginning of the year and nearly 150% since the Turkish central bank (CBRT) embarked on its easing cycle in August 2021.
What to look for around TRY
USD/TRY maintains its upside bias well in place, always underpinned by the relentless meltdown of the Turkish currency.
In the meantime, investors are expected to closely monitor upcoming decisions on monetary policy, particularly after President R. T. Erdogan named former economy chief M. Simsek as the new finance minister following the cabinet reshuffle in the wake of the May 28 second round of general elections.
The appointment of Simsek has been welcomed with optimism by market members in spite of the fact that it is not yet clear whether his orthodox stance on monetary policy can survive within Erdogan’s inclination to battle inflation via lower interest rates.
In a more macro scenario, price action around the Turkish lira is supposed to continue to spin around the performance of energy and commodity prices - which are directly correlated to developments from the war in Ukraine, broad risk appetite trends, and dollar dynamics.
Key events in Türkiye this week: Industrial Production (Friday).
Eminent issues on the back boiler: Persistent skepticism over the CBRT credibility/independence. Absence of structural reforms. Bouts of geopolitical concerns.
USD/TRY key levels
So far, the pair is gaining 1.27% at 21.4938 and faces the next hurdle at 21.5136 (all-time high June 5) followed by 22.00 (round level). On the downside, a break below 19.5815 (55-day SMA) would expose 19.2495 (100-day SMA) and finally 18.8910 (200-day SMA).
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD: Further gains look likely above 0.6400
AUD/USD reversed Wednesday’s decline and rose modestly on Thursday, managing to reclaim the area beyond 0.6300 the figure against the backdrop of fresh downside pressure in the Greenback.
EUR/USD met support at the 200-day SMA
EUR/USD rose markedly on Thursday, surpassing the 1.0800 barrier after bottoming out near 1.0730, an area coincident with the critical 200-day SMA, all amid renewed loss of momentum in the US Dollar.
Gold trades around $3,050, higher highs ahead
Relentless tariff jitters, coupled with renewed weakness in the US Dollar, have propelled gold prices back toward record territory—hovering just above $3,060 per troy ounce.
Bitcoin: Should you hold or have a trading system?
The term “HODL,” also known as “Diamond Hands” or “buy-and-hold (BNH),” first appeared in an online cryptocurrency forum in 2013 as a misspelling of the word “hold” — a typo that readers quickly adopted.
US: Trump's 'Liberation day' – What to expect?
Trump has so far enacted tariff changes that have lifted the trade-weighted average tariff rate on all US imports by around 5.5-6.0%-points. While re-rerouting of trade will decrease the effectiveness of tariffs over time, the current level is already close to the highest since the second world war.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.