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Commerzbank Warn Next TRY Move Could Be Just Around the Corner

TURKEY

Commerzbank write that TRY is again inching toward the alltime lows - and not exclusively due to USD strength, with a 50/50 EUR, USD basket also trading similarly.

  • They add that the moves are significant because it has gained momentum even as the dollar has eased.
  • This makes it clear that the government’s (and CBRT’s) crisis measures (FX protected deposits) or various quasi capital controls have failed to address any relevant economic issue – which of course is about the lack of central bank independence and inflation targeting.
  • Commerzbank conclude that Turkey’s deep negative real interest rate means that the next big move of the lira could be just around the corner.

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