- USD/TRY keeps the erratic trade just below 18.00.
- Türkiye Unemployment Rate ticked lower to 10.3% in June.
- US CPI next of note in the docket.
The Turkish lira loses some ground and motivates USD/TRY to resume the upside on Wednesday, always amidst the prevailing multi-session consolidative theme.
USD/TRY remains capped by 18.00
USD/TRY fades Tuesday’s pullback and extends the side-lined trade for yet another session, always on the back of bulls’ lack of conviction to advance further north of the key barrier at the 18.00 yardstick.
In the domestic calendar, the jobless rate in Türkiye eased a tad to 10.3% in June vs. a month earlier.
Later in the session, all the attention is expected to be on the release of US inflation figures gauged by the CPI for the month of July.
What to look for around TRY
The upside bias in USD/TRY remains unchanged and stays on course to revisit the key 18.00 zone.
In the meantime, the lira’s price action is expected to keep gyrating around the performance of energy and commodity prices - which are directly correlated to developments from the war in Ukraine - the broad risk appetite trends and the Fed’s rate path in the next months.
Extra risks facing the Turkish currency also come from the domestic backyard, as inflation gives no signs of abating (despite rising less than forecast in July), real interest rates remain entrenched in negative figures and the political pressure to keep the CBRT biased towards low interest rates remains omnipresent. In addition, there seems to be no Plan B to attract much-needed foreign currency, despite the recent increase in the country’s FX reserves.
Key events in Türkiye this week: Unemployment Rate (Wednesday) – Current Account (Thursday) – End year CPI Forecast, Industrial Production, Retail Sales (Friday).
Eminent issues on the back boiler: FX intervention by the CBRT. Progress (or lack of it) of the government’s new scheme oriented to support the lira via protected time deposits. Constant government pressure on the CBRT vs. bank’s credibility/independence. Bouts of geopolitical concerns. Structural reforms. Presidential/Parliamentary elections in June 23.
USD/TRY key levels
So far, the pair is gaining 0.46% at 17.9583 and faces the immediate target at 17.9874 (2022 high August 3) seconded by 18.2582 (all-time high December 20) and then 19.00 (round level). On the other hand, a breach of 17.1903 (weekly low July 15) would pave the way for 16.2174 (100-day SMA) and finally 16.0365 (monthly low June 27).
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.