Turkish Lira surged higher by around 7.7% against the US Dollar following the Central Bank of Türkiye (CBoT’s) latest policy meeting. Economists at MUFG Bank analyze TRY outlook.
CBoT delivers large hike helping to restore investor confidence
CBoT delivered a much larger than expected rate hike of 7.50 percentage points that lifted the policy rate up to 25.00%. The policy rate has now been increased by 16.50 percentage points in total since June, and now exceeds the peak from back in 2018 and 2019.
Higher rates should again begin to offer more support for the Lira after the larger hike helped Turkey to regain policy credibility. Investors will now have more confidence in the shift back to more orthodox policy settings that have been taking place since the elections in May.
We expect the CBoT to deliver further larger hikes at upcoming policy meetings to lift the policy rate closer to 35.0%. At the very least the developments should slow the pace of further Lira depreciation through the rest of this year and pose downside risks to our USD/TRY forecasts, although we are not convinced yet that conditions are in place for a sustained rebound
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.
