- Turkey’s Lira drops more than 10% in the third quarter.
- Fears of a balance of payment crisis and regional military tensions weigh over Lira.
There seems to be no stopping the Lira sell-off.
The Turkish currency is currently trading at 7.8127 per US dollar, down 14% in the third quarter. The currency declined by 5.4%, 11.13%, and 3.59% in Q4 2019, Q1 2020, Q2 2020, respectively.
The fourth straight quarterly decline is the biggest since the third quarter of 2018 when the currency slipped by 31.76%.
Markets have offered Lira this quarter due to fears a full-blown balance of payment crisis in Turkey and, more recently, due to Turkey’s involvement in tensions between Armenia and Azerbaijan.
Turkey’s central bank raised rates by two percentage points to 10.25% on Thursday – the first rate hike in two years. The move saw TRY appreciate from 7.71 to 7.50 and then slide to new record lows above 7.80.
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