Following Donald Trump's election as the new U.S. president, the volatility in the markets has been continuing. The dollar-lira parity climbed to 3.2983 after the sales wave that developed in global bond markets following the election and currencies of developing countries were negatively affected.
With the course of the political developments within the country in addition to external factors, pressure on Turkish Lira is continuing. Climbing up to 3.29 last week, the dollar-lira parity started at around the 3.2550 level on Friday, close to the closing levels, however, the currency went on the rise and surged up to 3.2980. The dollar-lira parity is maintaining a level around 3.2905 as of 3:08 p.m. Sunday.
Developing countries' currencies weaken
Speaking to the financial site Dünya, Investment Support Research Specialist Kutay Gözgör stated that the expectation of the fiscal policies, which will be implemented following Trump's election, is likely to rapidly increase the inflation rate causing the US 10-YRs and 30-YRs to also increase rapidly.
Stressing that US 30-YRs rise to 3 percent was the most drastic growth since January, Gözgör said, adding that alongside the Turkish Lira, all the currencies of developing countries, particularly Latin American currencies, devaluated.
Deputy Prime Minister Numan Kurtulmuş said in a statement following a recent Cabinet meeting that the dollar's rise did not result from Turkey's structural difficulties or problems.
Intervention from Indonesia
Highlighting that the continuation of the sale wave in the global bond market will continue to negatively affect the currencies of developing countries, Gözgör said in the aftermath of the devaluations, the first intervention came from the Bank of Indonesia; however, the bank's move which supported the devaluating rupee was not effective.
Güzgör stressed that the volatility in the markets is likely to continue because of Trump's election. He stated that the 3.30 level that emerged following the U.S. election can technically be observed as an important resistance, while the dollar-lira parity, which rapidly increased following the exceeding of the main resistance level of 3.2780, can be observed as a support by changing roles. Güzgör added that if the level stays above 3.2780, the resistance level of 3.300 will be exceeded and the 3.3150 - 3.3200 level may come to the agenda, and 3.2540 can be followed below the 3.2780 level.
Sales pressure rules in the stock exchange
The BIST 100 index lost 0.49 percent in the first half of the day and entered the continuous action transactions with 74,805.24 points. The devaluation reached 1 percent in the second half of the day. The BIST 100 is trying to stay above 75,000 points.
Ten-year bond's interest rates climbed to 10.99 percent increasing by 14 basis points prior to the auctions which will be held by the Treasury and have seen the highest level on the closing basis since January.
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