USD/TRY recedes from (another) all-time highs past 8.30

  • USD/TRY remains well bid above the 8.00 mark.
  • Geopolitical, monetary concerns keep weighing on the lira.
  • Turkey’s Economic Confidence improved to 92.80 in October.

The lira’s rout remains unabated for yet another session and pushes USD/TRY to fresh all-time highs beyond 8.30 on Wednesday.

USD/TRY looks to geopolitics

USD/TRY extends the upside in tandem with the unremitting depreciation of the Turkish lira, which has already shed around 28% so far this year.

Investors continue to sell the lira following last week’s decision by the Turkish central bank to leave the One-Week Repo Rate unchanged vs. the broad consensus favouring at least 150bps hike.

Extra downside on the currency comes from the geopolitical side in response to rising bets on US and EU sanctions against Ankara following the purchase of the Russian S-400 missile defence system and escalating verbal tensions with France.

That, plus Turkey’s ongoing involvement in conflicts in the Eastern Mediterranean and the Caucasus have been exacerbating the selling pressure around TRY.

On the domestic scenario, the prospects of higher inflation appear reinforced by the reluctance of the CBRT to tighten its monetary policy further (or at least in line with market expectations). The situation looks aggravated by the continuous loss of FX reserves by state-owned lenders in order to prevent the currency to keep debilitating. A lethal cocktail for a balance of payments crisis keeps brewing in the meantime…

Data wise in Turkey, the Economic Sentiment edged higher to 92.8 for the current month.

USD/TRY key levels

At the moment the pair is gaining 1.09% at 8.2727 and faces the next hurdle at 8.3158 (all-time high Oct.28). On the downside, a drop below 7.7787 (low Oct.22) would expose 7.6294 (monthly low Oct.1) and finally 7.5082 (low Sep.25).

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.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD hits fresh two-month highs amid dollar weakness

EUR/USD has hit new two-month highs above 1.1940 as the dollar resumes its decline. Optimism about the US transition and covid vaccines is weighing on the safe-haven dollar. 


GBP/USD falls toward 1.33 amid Brexit acrimony

GBP/USD is falling toward 1.33 as both the EU and the UK are busy blaming each other for an impasse in Brexit talks. The thorny issues remain fisheries, governance and setting a level playing field.


XAU/USD attempting to bounce up from $1,775 low

Gold futures accelerated heir downtrend from last week highs near $1,900, breaking below the 200-day SMA, at $1,800 area, to hit its lowest prices in nearly five months, at $1,775.

Gold news

Dollar offered ahead of the weekend

Equities are finishing the week on a firm tone, while the US dollar remains heavy. In the Asia Pacific, only Australia and India did not end the week on a firm note.

Read more

Black Friday 2020 Discounts!

Learn to trade with the best! Don't miss the most experienced traders and speakers in FXStreet Premium webinars. Also if you are a Premium member you can get real-time FXS Signals and receive daily market analysis with the best forex insights!

More info