- USD / TRY extends laterality around 7.70.
- The markets’ attention remains on the key CBRT meeting.
- The consensus foresees an interest rate hike of (at least) 500 bp.
The Turkish lira extends the consolidation mood for another session and leads to USD/TRY to the region of 7.70 on Wednesday.
USD/TRY mira al CBRT
USD / TRY is trading within a cautious range at the lower bound of the recent range ahead of the crucial Turkish central bank (CBRT) meeting on Thursday. Along these lines, investors expect the CBRT to increase the one-week repurchase rate by at least 500 basis points to restore some credibility and stability to the troubled lira.
In fact, the recent rally in the lira came after major changes at both the CBRT and the Finance Ministry and was later backed by favorable market comments from President RT Erdogan.
In fact, Erdogan stressed that Turkey will now seek to implement much-needed structural reforms based on macroeconomic and financial stability.
It is worth remembering that the lira’s fall in the August to November period followed growing concerns of a possible balance of payments crisis, geopolitical concerns, negative real interest rates, and a persistent and unsuccessful effort to avoid further depreciation. of currency through the sale of foreign exchange reserves.
Technical levels
At the moment, the pair has risen 0.27% to 7.7052 and faces the next hurdle at 7.7959 (November 17 weekly high) followed by 7.8281 (55-day SMA) and finally 8.5777 (November 6 all-time high) . On the downside, a drop below 7.5985 (Nov. 16 monthly low) would expose 7.4904 (100-day SMA) and then 72019 (Aug. 21 low).
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