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USD/TRY Surges +3% as Local USD Demand Picks Up Sharply

TURKEY
  • USD/TRY has had a notable rise today with dollarization risks snowballing as bloomberg cites increased local demand for USD – exacerbating the move higher.
  • TRY weakness is no surprise leading up to the CBRT, but this recent surge is somewhat more pronounced than many would have anticipated.
  • The CBRT is expected to cut rates by at least 100bp on Thursday, pulling rates deeper into negative real yield territory and making TRY assets more vulnerable to USD strength in the process
  • Focus remains on 10.50 as the next key level, remembering that many analysts have slapped an 11.00 year-end price target on USD/TRY.
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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