- USD/TRY stays firmer around record top during five- day uptrend.
- Turkey’s President Erdogan says economic problems are not due to lowering of rates.
- Omicron, US stimulus updates weigh on yields and DXY but no rescue for pair sellers.
- Risk catalysts are the key amid a light calendar.
USD/TRY prints 1.70% intraday gains while staying around record top, recently picking up bids to $16.80 during early Monday morning in Europe.
In doing so, the Turkish lira (TRY) pair shrugs of President Recep Tayyip Erdogan’s hawkish comments that defended the Central Bank of the Republic of Turkey (CBRT) rate cuts.
“President Tayyip Erdogan said he had lowered Turkey's inflation, currently above 21%, to around 4% before and that he will do it again soon,” said Reuters. “The new policy model based on low interest rates was part of an ‘economic independent war’,” adds Erdogan per the news.
While stepping forward in defense of the CBRT rate cuts, Erdogan said, per Reuters, “Recent problems in the economy were not caused by his push to lower interest rates, but rather by attacks on Turkey's economy.”
Reuters also said, “Speaking at an awards ceremony, Erdogan dismissed the idea of capital controls as ‘ridiculous’ and said Turkey would continue to operate within the free-market economy.”
Elsewhere, risk-off mood weighs on the stock futures in the West as well as the US Treasury yields. The main risk catalysts are the fears of the South African covid variant, dubbed as Omicron, joined by the US Democrats’ disappointment over stimulus and the Fed rate-hike calls.
Amid these plays, S&P 500 Futures drop 0.95% intraday whereas the US 10-year Treasury yields drop three basis points (bps) to 1.37%, down for the third consecutive day at the latest.
Although a light calendar and downbeat Treasury yields may test the USD/TRY bulls, the trend change is out of the question. For the short-term, risk catalysts are the key to follow for fresh impulse.
Technical analysis
Unless declining back below the previous resistance line from late November, around $15.20, USD/TRY bulls are on the way to $20.00 psychological magnet.
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
BoE set to maintain bank rate at 5%, how will Pound Sterling react? – LIVE
Following August's 25 basis points cut, the Bank of England (BoE) is forecast to maintain the bank rate at 5%. The statement language and the vote split could provide important clues about the policy outlook and drive GBP/USD's action.
EUR/USD rises further toward 1.1200, focus shifts to ECB-speak
EUR/USD stays strongly bid toward 1.1200 in the European session on Thursday. The pair capitalizes on a renewed US Dollar retreat and an upbeat mood. Traders digest the Fed's dovish outlook, bracing for ECB-speak for fresh trading incentives. US data are also eyed.
Gold hovers close to new high of $2,600 after Fed meeting
Gold (XAU/USD) edges higher and trades back in the $2,580s on Thursday after falling to the $2,540s following the US Federal Reserve (Fed) decision on interest rates the prior day.
Solana announces details of Seeker, second mobile device after Saga phone
Solana Lab’s second phone, Seeker, is set to launch in 2025. At Token2049, a global conference for crypto, Solana’s General Manager Emmett Hollyer said that the new mobile would be a “rewards magnet” for its users.
BoE expected to keep interest rate unchanged at 5% as price pressures persist
After a close call in August, the Bank of England’s September interest rate decision is keenly awaited for fresh cues on the bank’s future policy action and the pace of its bond sales.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.