Analysts at TD Securities note that weakness in the Turkish currency extended further in Asia but was far less dramatic than yesterday.
Key Quotes
“A warning by White House National Security Adviser John Bolton to the Turkish ambassador to the US, that there will be no further negotiations until a detained pastor is released, implies no let up in pressure from the US authorities.”
“For its part Turkey is showing little sign of giving any ground either, with President Erdogan taking aim at economic “traitors” and accusing the US of stabbing the country “in the back”.”
“Measures announced by the central bank to bolster the TRY have had limited impact and given the sharply differing stances as noted above, there appears to be limited prospect of any easing in tensions.”
“As such Turkish markets are likely to remain on edge, with other emerging markets remaining vulnerable to contagion. As a consequence of such tensions Argentina hiked its seven-day notes rates up 5% to 45% yesterday.”
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