Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Options markets are pricing considerable volatility in the wake of the Turkish elections, with polling data still too close to call, and the sizeable policy gap between the frontrunners making for extensive uncertainty for the Turkish economy. This document compiles a summary of sell-side views for the election itself, the trajectory of the economy and the scale of the market reaction.
See the full piece here:
One-week implied vol surged to new highs this week and sits above 60%, as the contract captures May 14 elections (Figure 1). Markets are bracing for further weakening in TRY, regardless of the outcome of elections on Sunday, due to concerns regarding the sustainability of government measures to prevent TRY depreciation. However, the limited success of such macroprudential measures is evidenced by the growing spread between the official USD/TRY spot rate and the unofficial 'Grand Bazaar' rate in recent weeks (Figure 2). This further emphasizes the limited ability of the authorities to contain the increasingly fragile market.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.