Lira getting Stronger - Why?

[Colwyn]

Quite right, KKOB. I already feel uncertain about the last sentence I wrote about defeat for IS being good for Turkey. If that actually does happen - not an immediate prospect, and anyway they will just disband, disperse and emerge in other places as other horrible movements - what happens to the weapons that the Kurds now hold? If they get shipped to the PKK then maybe that won't be good news at all.

[Ian]

I suspect every time RTE has a quiet week (not touring or making speeches) the markets think - oh its not that bad - and we see encouraging swings - but rest assured next week he will likely be touring again :-)

[Colwyn]

A few days ago I was thinking that the Lira has been pretty quiet recently; just bouncing around between fairly clear top and bottom borders. But today the dollar has hit a record high against the lira. OK, the dollar is strong but it seems particularly strong against TL. Perhaps it will bounce back again on Monday.

[kevin3]

Closed at  3. 68 tonight.  I think it's the President  v  the External Markets.

His talk of taking over the Central Bank will be sure to have a calming effect,     

[KKOB]

Yeah, it'll give him and his friends and family somewhere else to hide the shoeboxes.

[kevin3]

Don't tell me his White Elephants rooms are full up already.     

[Colwyn]

I still read on some Turkey forums that people who have sold their villas for TL saying they are waiting to change into £s until the rate comes back to 2.5/2.6ish. I have no idea what to say to these people - so I don't say anything.

[kevin3]

That's a wise saying.

[Colwyn]

One commentator says "The lira is on the verge of a cliff and markets should expect an historic depreciation this year". Another predicts by the end of 2015 TL could be at 3:1 against the dollar; that's 4.5:£. Dollar reserves are at a 12 month low making currency auctions more difficult. Is there any option other than an interest rate rise? The government is insisting that the rate be cut! It is going to be a bumpy ride up to the election.

http://www.todayszaman.com/business_political-noise-over-rates-revives-worst-case-scenario-for-lira_371234.html
 

[yabanci]

Is there any option other than an interest rate rise?
 

Yes an interest rate cut,if the inflation rate is lower when the figures are announced on Feb 3rd.