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USD/TRY Trims Early Gains as Ukraine Crisis Kicks Up a Gear

  • USD/TRY trades +0.49% higher this morning on the back of broad-based risk-off following weekend developments in the Russia-Ukraine crisis – but has trimmed early upside from 14.1023.
  • The cross came under pressure last week with markets increasingly concerned about supply shortages and energy prices driving inflation sharply in Turkey – resulting in selling pressure on TRY.
  • The CBRT & state banks were rumoured to be active in curbing TRY weakness, however, and will likely be active this week as markets become increasingly volatile. USD/TRY will likely remain vulnerable to changes in risk sentiment this week.
  • Local focus will be on CPI & PPI data towards the end of the week – with headline expected to rise to 52.50% y/y vs 58.69% prior and core to 42.55% vs 39.45% prior.
  • This widens Turkey’s negative real yields further, adding to headwinds facing TRY assets, but is unlikely to change the CBRT’s stance in the near-term.
  • Intraday Sup1: 13.8779, Sup2: 13.8071, Sup3: 13.7261, Res1: 14.025, Res2: 14.1056, Res3: 14.3708
MNI London Bureau | +44 020-3983-7894 |
MNI London Bureau | +44 020-3983-7894 |

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