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Market News Topics
May 27, 2022 11:27 GMT
MS See Continued Pressure on TRY Adding to Upside Inflation Risks
CBRT
- MS flag the phrasing in yesterday's CBRT policy statement, writing that the statement mentioned that new steps will be taken on collateral and liquidity policies to strengthen liraisation.* MS think that this could be related to recent news which reported that the CBRT will increase from 5% to 15% the discount rate applied to assets other than local currency government bonds used as collateral in funding operations.
- It could also be referring to the introduction of a new 3-month TRY repo funding facility (in addition to the 1-week repo funding) to incentivise the use of lira collateral in funding.
- The statement does not signal a tightening in the overall monetary policy stance despite the mention of additional measures. Hence, they see continued pressure on the lira adding to upside risks on inflation and expect some normalisation in real rates, either through the introduction of a new CPI-indexed bond, or an upward adjustment to deposit rates.
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
To read the full story
Close
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.
Sign up now for free trial access to this content.
Please enter your details below.
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.
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