Lira getting Stronger - Why?

[Colwyn]

The dollar briefly broke through the 4 lira line but is now back below at 3.965. In the past the Central Bank, it seems to me, has striven to keep TRY on the low side of 4. Will it be throwing money at this today?

[kevin3]

                  5. 65 at the mo'

[lissa]

Not good for us earning lira. ☹️

[JohnF]

Even more bad news for you, another record low against sterling today, 5.68 and the dollar broke the "4 barrier" on Friday.  Slight recovery but nothing to suggest the slide wont continue.

Looks like the euro is heading towards 5, another milestone the TCB wont be happy about.

JF

[Colwyn]

The dollar has peaked through 4 three times this morning. I wonder if the markets are testing the Central Bank's resolve.

[yabanci]

At least the TCB has a bit of money to throw at the problem.

http://www.hurriyetdailynews.com/turkish-central-banks-net-profit-soars-in-2017-129359

[Colwyn]

Nice typo in that article: "Last year, the bank transferred some 6.41 liras of its profit to the Treasury". Whoopee!

[JohnF]

How do you know it's a typo...?

JF

[Colwyn]

Are you stirring a scandal on where the rest of the 6.41 billion lira went? Its not in Spain's Islas Caja de Zapatos, is it?

[Colwyn]

I found this Al Monitor article interesting. It highlights Turkey's booming economy in 2017 with the second highest growth rate in the OECD. But if you measure the GDP in $ terms it actually shrank in the same period. And with inflation and unemployment both in double figures many Turks have not done well in the boom. The "boom" was driven by the Government's encouragement of borrowing and based on consumer spending bringing in foreign imports rather than new jobs in Turkey. This has resulted in Turkey's growing debt much of which is in $ which were nearly 22% more expensive to repay by the end of 2017 due to currency weakness. This leaves a fragile economy, continuing pressure on exchange rates and a reluctance by foreign capital to invest in Turkey. The article concludes:   "Political uncertainty is the main reason foreign investors hesitate to put money in Turkey. A critical election cycle is looming in 2019, but a wait-and-see attitude prevails on financial markets because of the talk of early elections. This reason alone could prompt the government to bring the polls forward — to fall this year, for instance — to end the uncertainty." (Mustafa Sonmez, Turkish Economist)

https://www.al-monitor.com/pulse/originals/2018/04/turkey-dark-side-of-glowing-growth-rate.html