Turkish lira notches more record lows on rate-cut concerns
Turkey’s lira touched new lows against the dollar and euro on Friday, hamstrung by worries over more interest rate cuts despite high inflation, after President Tayyip Erdogan dismissed three central bank policymakers.
Two of the three monetary policy committee (MPC) members ousted on Thursday were seen to oppose the bank’s 100 basis-point rate cut to 18% last month, and their dismissal clears the way for more policy easing as soon as next week.
A survey by the central bank showed market participants expected the rate to hit 16.6% in three months, representing cuts of 140 basis points, while inflation expectations rose.
The lira, which has weakened more than 19% this year so far, lost some 0.9% on Friday to hit an all-time low of 9.28 against the U.S. currency. It stood at 9.27 at 2103 GMT.
It also touched a record 10.7235 against the euro.
Reference: Reuters
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