Economy in Turkey: New peak seen in Dollar / TL exchange rate

While the Turkish Lira (TL) continues to be under pressure due to the global search for a safe haven, the new peak in the dollar/TL exchange rate has reached 33.61.

The TL continued to remain under pressure in the global search for a safe haven, losing more than 1% against the dollar this week; the new peak in the exchange rate reached 33.61. After rising to a new peak of 33.61 under the pressure of dollar sales, the dollar/TL started this morning at around 33.55. The TL lost 1.1% against the dollar this week.

Today’s domestic agenda includes the Treasury’s cash balance data for July. In the markets, the third inflation report of the year will be followed tomorrow.

Yesterday, Minister of Treasury and Finance Mehmet Şimşek stated that the top priority is to reduce inflation and that they will not back down on this matter, emphasizing that they do not intend to change the targets in the Medium Term Program (OVP).

Şimşek said, “…we will not back down, we do not intend to change the targets, we are determined on this matter. It may be ambitious, but we will take the necessary measures and continue on our path.”

OVERNIGHT RATE APPROACHES UPPER BAND, LIQUIDITY SURPLUS DECREASES

Overnight rates and excess liquidity are closely monitored in the domestic market. After the Turkish Central Bank (TCMB) started additional intra-day TL deposit auctions and reverse swap auctions with local banks last week, overnight rates have risen significantly.

The excess liquidity, which was around 400 billion TL last week, dropped significantly to 23 billion TL yesterday. The overnight rate, which had fallen to 47.02% last week, rose to 52.75% yesterday.