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USD/TRY Hits a Bump at 200dma; $ Factors in Focus

TURKEY
  • Local curve mixed after selling activity pushed yields higher during yesterday's session after a higher than expected CPI print.
  • Losses concentrated in 5Y +20bp.
  • USD curve saw modest gains in the belly, and may see more modest inflows today over local GBs.
  • USD/TRY opens lower in line with CEEMEA peers and a softer USD.
  • Spot may remain choppy in the 7.4679-7.3484 range, pegged above the 200dma at 7.3243.
  • CDS notched up during yesterday's session but is broadly expected to continue to compress in the near term in line with EM optimism.
  • Limited local catalysts means USD drivers should dominate price action.
  • Sell-side still favouring USD shorts, saying positioning is more neutral
  • offering scope for more net shorts to be built.
  • Move through the 200dma would be the trigger for more downside.
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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