August 18, 2022 11:10 GMT
- Selling pressure on TRY is surging following the CBRT surprising decision to cut its 1W repo rate by 100bps to 13% today.
- USDTRY broke above the 18 psychological resistance following the decision; next key level to watch on the topside stands at 18.3630 (20 Dec 2021 high).
- CBRT mentioned that financial conditions need to be supportive given the poor macro outlook.
- This goes against the 'Lira-ization' strategy as it pushes real yields to deeper negative territory, therefore could continue to weigh on the TRY in the medium term.
Link to statement: