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TRY Reacts Positively To Abandonment Asset Ratio Rule

TURKEY
  • Broad-based risk-off and profit taking saw yields track higher across local and USD curves yesterday in a bear steepening move.
  • Yields should react positively to signs of increased policy transparency from the CBRT this morning following the abandonment of the Asset Ratio rule.
  • USD/TRY opened higher towards 7.95 in line with EM sentiment and lower prints for business confidence metrics, but pushed lower following the removal of the Asset Ratio rule.
  • With risk sentiment rocky, the cross should remain vulnerable to external factors.
  • The 8.00 handle should keep a lid on price action for now, with the pair occupying a wide range between the 50dma (7.897) and 100dma (7.5349).
  • 1w vols have ticked up slightly from monthly lows while the 5Y CDS has held broadly flat since Friday.
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com

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