The Turkish lira resumes the downtrend and pushes USD/TRY back above the key barrier at 12.0000 the figure at the end of the week.
The Turkish currency depreciates on Friday in response to earlier comments from Deputy Finance Minister N.Nebati, who insisted on defending the low-interest-rate policy carried out in the country.
In line with President Erdogan’s latest speech, Nebati highlighted the “wrongness of the high interest, low inflation policy”, while added that there are no issues with the current policy of keeping the One-Week Repo Rate lower than inflation.
The lira might beg to differ on the latter, as it lost around 35% since the easing cycle started on September 23, when the Turkish central bank reduced the policy rate by 100bps to 18.00%.
So far, the pair is gaining 0.87% at 12.0569 and a drop below 11.5451 (low November 24) would expose 11.3370 (10-day SMA) and then 10.5292 (20-day SMA). On the other hand, the next up barrier lines up at 13.1105 (all-time high Nov.24) followed by 14.0000 (round level).
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