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Central Bank Sell TRY-Settled Forwards, in Second Session of Curbing FX Appetite

TURKEY
  • The CBRT have sold $426mln of TRY-settled FX forward - the second such sale of this week.
  • We noted yesterday that the CBRT's $475mln sale was the first since July last year - which comes alongside the CBRT putting in calls to commercial lenders to attempt to cap hard currency demand by re-imposing limits on interbank FX buys. Bloomberg estimate the cumulative impact of the measures as equivalent of a 230bps rate hike (would put the effective rate at 47.3%).
  • Other measures adopted include a request from authorities for banks not to trade in forward contracts with a tenor under three months - according to Bloomberg sources.

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