- The Turkish Lira gains ground and climbs to 5.65 vs. the greenback.
- The CBRT left the repo rate unchanged at 24.00% at today’s meeting.
- The pair challenges 3-day lows in the 5.65/6400 region.
The Turkish Lira is gaining further momentum on Wednesday and is now dragging USD/TRY to test the area of fresh lows in the 5.6500 neighbourhood.
USD/TRY offered on CBRT decision
The Lira gained extra buying interest after the Turkish central bank (CBRT) left unchanged the policy rate (one-week repo auction rate) at 24.00% at today’s meeting, matching initial estimates.
The central bank justified its decision on the strong external demand, the persistent slowdown in domestic economic activity ‘due to tighter financial conditions’.
The CBRT acknowledged that inflation outlook has been deteriorating and price stability is facing risks mainly in response to movements in the exchange rates. The central bank also noted that weaker domestic demand conditions ‘will partially mitigate the deterioration in the inflation outlook’, although further upside risks on the pricing behavior could not be ruled out.
USD/TRY key levels
At the moment the pair is losing 1.11% at 5.6406 facing the next support at 5.5365 (100-day SMA) seconded by 5.5093 (low Oct.18) and then 4.7942 (200-day SMA). On the other hand, a breakout of 5.8813 (21-day SMA) would open the door to 5.8780 (high Oct.23) and finally 6.1389 (55-day SMA).
Share
