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The US dollar strengthened against the yen during the Asian session, as investors sold safe-haven assets after a failed coup in Turkey. USD/JPY pair started the week higher to Y105.70, also slightly stronger were the euro and the pound.
Turkish lira was able to recover a considerable part of the losses incurred on Friday, but analysts say caution about the future prospects of the currency. The coup, though failed, pointed to a serious problem in Turkey, and the reaction of the Turkish authorities involves further risks increasing tensions in relations with the United States. There is no consensus regarding the course of the Turkish lira. Commerzbank believe that USD/TRY from current levels near 2.9696 will gradually return to 2.95, and possibly to 2.90. Goldman Sachs believe that now, when the storm of emotion has passed, investors will be engaged in the revision of its estimates of Turkish assets that are unlikely to be positive for the Turkish currency.
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