USD/TRY: Turkish lira looks set to remain volatile – Credit Suisse

Matías Salord FXStreet

Analysts at Credit Suisse continue to have a bearish view of the Turkish lira. They anticipate that the exchange rate will remain volatile with the government experimenting with unconventional policies.

Key Quotes:

“The lira looks set to remain volatile as the government experiments with unconventional policies (e.g. FX-linked TRY deposits) while real rates have fallen far into negative territory.”

“Another phase of abnormal volatility, similar to the one in mid-December, cannot be ruled out.”

“Meanwhile, the risk of an early elections announcement in Q1 2022 seems low. But if it materialises anyway, it will probably pave the way for some respite for the lira.”

“The vulnerability of the lira is likely to lead markets to build up further risk-premium in front-end rates. We see scope for 1-year OIS rates to rise above their November high of 27.30% and possibly reach 30.00% later in Q1.”

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

EUR/USD climbs to daily highs near 1.1820

EUR/USD now picks up pace and advances to the area of daily peaks north of the 1.1800 barrier at the end of the week. The pair’s decent move higher comes against the backdrop of a generalised lack of direction in the FX galaxy and the mild offered stance in the US Dollar.

GBP/USD trims losses, retests 1.3460

After briefly challenging its key 200-day SMA near 1.3440, GBP/USD now manages to regain some balance and revisit the 1.3460 zone on Friday. Cable’s pullback comes as the selling pressure on the Greenback gathers traction, reigniting some recovery in the risk-linked space.

Gold flirts with four-week highs past $5,200

Gold extends its rebound, climbing for a third consecutive session and pushing back above the $5,200 mark per troy ounce on Friday. The move higher continues to draw support from lingering geopolitical tensions and the ongoing uncertainty surrounding US trade policy, both of which are keeping safe-haven demand firmly in play.

Bitcoin, Ethereum and Ripple consolidate with short-term cautious bullish bias

Bitcoin, Ethereum and Ripple are consolidating near key technical areas on Friday, showing mild signs of stabilization after recent volatility. BTC holds above $67,000 despite mild losses so far this week, while ETH hovers around $2,000 after a rejection near its upper consolidation boundary.

Changing the game: International implications of recent tariff developments

The Supreme Court ruling on International Emergency Economic Powers Act (IEEPA) tariffs provides limited relief for the rest of the world, with weighted average tariff rates modestly lower.

Starknet unveils strkBTC, shielded Bitcoin transactions on Ethereum Layer 2

Starknet, the Ethereum Layer 2 network developed by StarkWare, today announced strkBTC, a wrapped Bitcoin asset that introduces optional shielding while preserving full DeFi composability.