USD/TRY stays on the defensive so far this week, tests the 5.56 area. CBRT’s Uysal said tight monpol reduced inflation outlook. Turkey manufacturing PMI eased to 46.70 in July. The Turkish Lira keeps the bid tone unchanged so far this week, motivating USD/TRY to test fresh lows near the 5.5600 level earlier in the session, just to rebound soon afterwards. USD/TRY on the defensive despite FOMC, CBRT The pair is adding to yesterday’s gains following the better tone in the buck in the wake of the FOMC event. The Lira keeps the firm tone unabated despite the Turkish central bank (CBRT) reduced its One-Week Repo Rate by a massive 425 bps last week, taking the key rate to 19.75%. The rate cut was the largest since 2002. Reinforcing this view, and at the bank’s Inflation Report published yesterday, Governor M.Uysal revised lower the projections for inflation and left the door open for extra rate cuts in the next months. In fact, the central bank now sees consumer prices rising between 11.5% and 16% on a yearly basis by year-end, while it left unchanged the forecasts for 2020 at 8.2% and 2021 at 5.4%. In the domestic docket and earlier today, the Turkish manufacturing PMI dropped to 46.7 for the month of July. Later in the NA session, the ISM Manufacturing will be in the limelight in the US calendar. What to look for around TRY The Lira is extending the multi-session leg lower so far this week, surprisingly digesting very well the large interest rate cut by the CBRT last week. Newly appointed Governor M.Uysal appears to have inaugurated an Erdogan-sponsored easing cycle. Whether this move was untimely (as regarded before the rate cut) it remains to be seen. In the meantime, TRY remains supported by the ongoing ‘hunt for yield’, as domestic rates still look attractive in spite of the recent cut. However, the lack of solid progress on the US-China trade dispute and its negative impact on prospects of global growth carries the potential to spark quick and strong outflows from TRY, undermining the ongoing recovery and threatening at the same time to spark another crisis in the currency. On the more macro view, the country needs to implement the much-needed structural reforms (announced in April) to bring in more stability to the currency and sustain a serious recovery in both economic activity and credibility. USD/TRY key levels At the moment the pair is up 0.08% at 5.5901 and a surpass of 5.6587 (21-day SMA) would expose 5.7727 (high Jul.25) and finally 5.7849 (monthly high Jul.8). On the downside, the next support lines up at 5.5151 (low Jul.31) followed by 5.2918 (monthly low Mar.29) and then 5.1594 (2019 low Jan.31). FX Street FX Street FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions. View All Post By FX Street FXStreet News share Read Next GBP/JPY hammered down to 131.00 neighborhood, lowest since Nov. 2016 FX Street 4 years USD/TRY stays on the defensive so far this week, tests the 5.56 area. CBRT's Uysal said tight monpol reduced inflation outlook. Turkey manufacturing PMI eased to 46.70 in July. The Turkish Lira keeps the bid tone unchanged so far this week, motivating USD/TRY to test fresh lows near the 5.5600 level earlier in the session, just to rebound soon afterwards. USD/TRY on the defensive despite FOMC, CBRT The pair is adding to yesterday's gains following the better tone in the buck in the wake of the FOMC event. The Lira keeps the firm tone unabated despite the Turkish central bank… Regulated Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk.4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk.5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.