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Turkish lira hits weakest intraday low in 6M

Turkish lira hits weakest intraday low in 6M

Mubasher: The Turkish lira (TRY) dropped against the dollar on Wednesday, recording the weakest level since mid-October 2018, against the backdrop of challenges to Istanbul election outcome and strained ties with the US, according to Reuters.

As investors evaluated such risks, market focus was also diverted to the Turkish central bank’s policy meeting due on Thursday, with wide expectations of keeping the interest rate at the current 24%.

The lira weakened as low as TRY 5.8792, compared with the prior close of TRY 5.83, sending the decline so far this year to 10% against the dollar.

By 1:17 pm GMT, the USD/TRY pair climbed 1.05% to TRY 5.8898.

Turkey’s election board on Tuesday dismissed one of a series of challenges filed by President Recep Tayyip Erdogan’s Justice and Development Party (AKP) against last month’s Istanbul elections.

Moreover, worries about the troubled US-Turkish relations were further fanned by Washington’s demand earlier this week for importers of Iranian crude oil, including Turkey, to cease their purchases by 1 May.

Relations with the US have been strained for months after Ankara’s order for Russian S-400 missile defence systems.

Secretary of State Mike Pompeo as well as prominent US senators warned Ankara that it will face sanctions for getting the missile systems, under a legislation that imposes penalties against any party that purchases military equipment from Moscow.