Fresh lira slide rekindles crisis fears for Turkey

31 July 2020
223 Views

Turkey’s lira is back in the spotlight. After two months of stability, the currency is testing the 7-per-dollar threshold and tumbling to record lows versus the euro, rekindling memories of the August 2018 lira meltdown.

Speaking on Wednesday, Central Bank Governor Murat Uysal downplayed concerns about the bank’s depleted FX reserves, which he said would naturally fluctuate during a pandemic. He did not address a drop of as much as 1.8% in the currency this week that could put more pressure on that buffer.

Below are five charts showing the extent of the pressure on the lira.

It takes firepower to support a currency. Just how much of that the central bank has left has come into focus.

Official data puts official net international reserves at $31 billion. But minus swap lines, gold reserves and lines to domestic banks, the number is negative, analysts calculate.

“Given the pace of reserve burn this year, we extrapolate that the CBRT will have used all of its reported gross reserves (mostly borrowed) by late summer/early autumn,” said Cristian Maggio at TD Securities.

Source: Reuters

You may be interested

Covid-19 Greece – 339 new cases reported
GREECE
shares35 views
GREECE
shares35 views

Covid-19 Greece – 339 new cases reported

makis - Sep 18, 2020

A total of 339 new cases of coronavirus in Greece were announced today, 39 of which were identified after checks…

Covid-19 Greece – 9 deaths in a day reported
GREECE
shares32 views
GREECE
shares32 views

Covid-19 Greece – 9 deaths in a day reported

makis - Sep 18, 2020

A total of 359 new cases of coronavirus in Greece were announced today, 36 of which were identified after checks…

Researchers untangle Crete’s oldest number system
GREECE
shares34 views
GREECE
shares34 views

Researchers untangle Crete’s oldest number system

Panos - Sep 18, 2020

According to a statement released by Elsevier, Silvia Ferrara of the University of Bologna and her colleagues conducted a new…

Leave a Comment

Your email address will not be published.