Turkish lira [TRY] breaks Historic Record, soars to over $1.00 = 3.00490TL

The Turkish lira hit a fresh record low above 3.0 to the dollar on Friday September 4th and continued on Monday September 7th, against a background of political uncertainty and security concerns.

The lira peaked at a level of 3.0057 in late trade before edging back slightly to 3.0000 at 1507 GMT and is back to 3.00490 on Monday Sept 7th morning.

The lira began weakening on Thursday after August inflation data came out higher than expected, with annual consumer price inflation rising back above 7 percent on high food prices.

However, the political pressures generated by a looming snap parliamentary election on Nov. 1 were expected to discourage the Turkish Central Bank (CBT) from raising rates in response.

"It seems like the CBT is reluctant to go for a rate hike before elections hence the continued lira (TL) weakness," Tera Brokers said in a note.

"Ironically, it is becoming a vicious circle; TL depreciation pushing up inflation which then triggers more TL weakness," it said, noting that the currency had lost 22 percent of its value against the dollar this year.


At 0719 GMT the lira stood at 2.9850 against the dollar, having touched a low of 2.9983 in early trade - just off a record low of 3.0020 which it hit on Aug. 20.

Markets will be digesting the statement on inflation and the bank's real effective exchange rate data (1130 GMT).

Credit: BGN News