New peak recorded in exchange rate:  US dollar climbs towards 18 TL level

Dollar / TL continued its rise towards the level of 18 due to concerns about economic preferences, especially interest rate and foreign exchange policy, fears of high inflation and global recession.

Investors will follow the Fed’s interest rate decision today, the likely revision of the CBRT’s inflation forecast for the end of the year, which is currently 42.8 percent, tomorrow, and the speech of CBRT President at the Istanbul Chamber of Industry (ISO) on Friday, which will also cover access to finance.

The markets will also be monitored regarding whether corporate exchange rate protected deposit (KKM) returns (which start these days and are estimated to be worth $ 30 billion in five weeks) will create new foreign exchange demand.

The Fed is expected to announce a 75 basis point rate hike at TSI 2100 after the monetary policy meeting that ends today. Investors, on the other hand, prefer investments such as the dollar, which is considered a safe haven, since they also give the possibility that the size of the interest rate increase may change in two ways.

As of today, the markets are pricing in the fact that the Fed will raise rates by 75 basis points, while futures contracts give a 15% probability of a rate increase of 100 basis points.

DEPRECIATION IN TL HAS EXCEEDED 26 PERCENT SINCE BEGINNING OF THE YEAR

The TL, which lost more than 40 percent in value last year, lost value continuously from end of April to the BDDK loan restriction decision, and the dollar / TL increased from 14.8 to 17.5 in this period.

Although the BDDK decision temporarily reduced the exchange rate to 16, the TL began to depreciate again. TL has been depreciating by 0.3-0.5 percent daily in recent weeks.