Analysts at Danske Bank note that the Turkish lira continues to be under pressure and lost more than 5% against the dollar yesterday, given the political tensions between Turkey and the US and the lack of progress in diplomatic talks between Turkish officials and US officials.
Key Quotes
“The market is looking for central bank action in Turkey in order to stem the lira s slide. Furthermore, the CDS on Turkish government debt has risen more than 200bp and is now very close to the levels for the CDS on Greece. Hence, the price for hedging Turkish debt has become very expensive in recent months.”
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