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Turkish Assets Feel Some Reprieve, Risks Remain

TURKEY
  • TRY assets are seeing some relief today after a yesterday's fire sale that sent yields over +100bp higher and USD/TRY skyrocketing +18% at the peak to a new all-time high.
  • While today may be calmer, risks still remain so long as the CBRT fails to deliver any policy changes or commit to ceasing the relentless easing into oncoming CPI headwinds.
  • The sell-side are now calling for emergency hikes to reassert a more credible policy mix and re-anchor runaway expectations with accelerating dollarization driving yesterday's depreciation.
  • Turkish local & USD rates stand modestly firmer, alongside a stronger TRY – now gaining ground back vs the USD (USD/TRY -4.88%) as it approaches support at 12.0716
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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