USD/TRY broke above the March highs....>

TURKISH LIRA: USD/TRY broke above the March highs to hit the best levels since

early January's currency flash crash Thursday, with focus remaining on an FT

report suggesting the Turkish central bank used swaps arrangements with domestic

banks in order to shore up FX reserves. As a result, TRY is comfortably the

poorest performing currency across EM and DMFX so far, with USD/TRY topping out

at 5.8515.

-Despite the surge in the spot rate, implied vols are somewhat calmer, with 1m

implied edging slightly higher but remaining close to the April average, with

the same seen in shorter-end contracts (overnight, 1w).

-Turkish President Erdogan has fought back against the FT report today, claiming

"whatever the FT writes, Turkey's situation is clear". The news comes ahead of

the Turkish central bank's rate decision due next week on Apr24, with the bank

expected to keep key policy rates unchanged at 24.0%.