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USD/TRY gains momentum and sets new highs at 15.50

USD/TRY moves higher to new 2022 peaks around 15.50. Turkey Industrial Production expanded 9.6% YoY in March. Turkey Retail Sales grew 0.3% MoM also in March. The Turkish lira continues to grind lower and lifts USD/TRY to new 2022 highs in the 15.50 region on Friday. USD/TRY up on USD-strength, geopolitics USD/TRY extends the monthly…

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  • USD/TRY moves higher to new 2022 peaks around 15.50.
  • Turkey Industrial Production grew 9.6% YoY during March.
  • Turkey Retail sales grew 0.3% also in March.

The Turkish lira continues to grind lower and lifts USD/TRY to new 2022 highs in the 15. 50 region on Friday.

USD/TRY up on USD-strength, geopolitics

USD/TRY extends Friday’s monthly rebound. The rally in the dollar continues unabated, and geopolitical worries keep the lira off the back foot.

President Erdogan didn’t welcome the news that Sweden and Finland would apply for NATO membership amid increasing tensions between Russia and the West over the conflict in Ukraine.

Data wise, retail sales in Turkey increased 0.3% MoM and 2.5% during the past twelve months. Industrial Production grew at 9.6% annually, exceeding initial estimates.

What to look for around TRY

USD/TRY keeps the upside well and sound for yet another session and already left behind the 15. 00 barrier. So far, price action in the Turkish currency is expected to gyrate around the performance of energy prices, the broad risk appetite trends, the Fed’s rate path and the developments from the war in Ukraine. TRY faces additional risks from domestic sources. Inflation is not slowing down, real interest rates are still negative and there is a lot of political pressure to keep CBRT biased towards low rates.

Key events in Turkey this week: Unemployment Rate (Tuesday).

Eminent issues on the back boiler: FX intervention by the CBRT. The government’s new scheme to support the lira through protected time deposits is making progress (or not). Constant government pressure on the CBRT vs. bank’s credibility/independence. Bouts of geopolitical issues. Structural reforms. Upcoming Presidential/Parliamentary elections.

USD/TRY key levels

So far, the pair has gained 0. 63% at 15. 4618 and faces the next hurdle at 15. 4832 (2022 high May 13) seconded by 18. 2582 (all-time high December 20) and then 19. 00 (round level). On the other hand, a drop below 14. 6836 (monthly low May 4) would expose 14. 5458 (monthly low April 12) and finally 14. 5136 (weekly low March 29).

Information on these pages contains forward-looking statements

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