US dollar climbs after President Erdogan’s statements regarding new tension with US
US dollar which declined to 5.40 after FED decision the previous day, started climbing again going up to 5.57 following a new tension with the USA and President Erdogan’s statement in regards.
The risk perception which increased with Trump’s statement regarding Golan Heights, following S-400 tension has put Turkish lira under pressure causing dollar/TL rate to climb to 5.5767, the highest level since January 3rd 2019.
The exchange rate had seen a sharp fall from 5.4850 to 5.40, the day before the Fed decided not to raise interest during the rest of the year. Later, it had completed the day at 5.46 following the news delivery of F-35 planes to Turkey could be suspended.
Thereafter, President Erdogan made a statement saying “The unfortunate statement of the US President has brought the region to the threshold of a new crisis and tension. We will never allow the legitimation of the occupation of the Golan Heights”.
Experts and opinion leaders interpret discussions of sovereignty on Golan Heights at a time when concern originating from S-400 agreement between Russia and Turkey is still on the agenda of concerned countries, as a new development to further worsen Turkey US relations.
Economists also point to the fact that citizens have been continuing to increase their savings in foreign exchange for the last six months which is another reason to put Turkish lira under pressure.
To provide an example, the foreign currency denominated total deposits and funds of individuals who bought foreign currency worth US$ 1.64 billion last week only, broke a record with US$ 105.7 billion. With the inclusion of companies, foreign exchange deposits and funds increased by $ 4 billion to USD 175.8 billion in the week of March 15, seeing the historic peak.
