The Lira exchange rate is inching weaker, relentlessly, as it has done since May. Economists at Commerzbank analyze TRY outlook as Turkey’s central bank (CBT) appears to be keen to progress with its “policy normalisation” or reform agenda.
The Turkish central bank trying to continue reform agenda
It is commendable that CBT wants to push ahead with rolling back capital controls, even as the Lira is proving difficult to support. These reforms will have the effect of relaxing capital controls and exposing the TRY further.
Granted that CBT wants to use an outright higher interest rate to stabilise the currency, but so far after two rate hikes, the day-to-day pattern of currency movement still suggests continuous FX interventions. This raises question marks about how successful CBT will be in making this transition to less capital controls. The entire challenge arises, of course, because markets cannot be sure of what President Tayyip Erdogan is thinking at present and whether or not CBT’s latest measures can be assumed to be permanent or just temporary.
면책 조항: 본 게시글에 표현된 견해는 전적으로 작성자의 견해이며 Followme의 공식 입장을 대변하지 않습니다. Followme는 제공된 정보의 정확성, 완전성 또는 신뢰성에 대해 책임을 지지 않으며, 서면으로 명시적으로 언급되지 않는 한 해당 내용을 기반으로 취해진 어떠한 조치에 대해서도 책임을 지지 않습니다.
