Turkey state banks prop up Lira ahead of Syria incursion
The lira weakened as Turkey announced the beginning of a military offensive into northeastern Syria, stymieing efforts by state banks to buttress the currency through dollar sales.
The Turkish currency reversed earlier gains to trade 0.5% weaker at 5.8565 per dollar as of 5:20 p.m in Istanbul. Earlier, state banks sold U.S. currency around the 5.84 per-dollar mark, according to four people familiar with the matter, who asked not to be identified as the information isn’t public. They bought about $1 billion-worth of lira on Monday and Tuesday, according to two of the people.
The currency posted its biggest decline since early August on Monday, amid concern that Turkey and the U.S. were lurching toward a fresh diplomatic crisis over Ankara’s plans in Syria. While American President Donald Trump tacitly endorsed the operation on Sunday, a day later he threatened to “obliterate” Turkey’s economy if it did anything he considered “off-limits.”
The dollar sales may revive a debate about the strength of the central bank’s foreign-currency buffers, which surfaced in the weeks leading up to municipal elections in March. At the time, state banks were said to have sold between $10 billion and $15 billion to stem the lira’s depreciation.
You may be interested
Muslims to pray in front of Hagia Sophia to put pressure to revert historic site into a Mosquemakis - May 28, 2020
Muslim mosques in Turkey will be reopening from tomorrow, Friday, the day of the fall of Constantinople (Istanbul), with the…
Athens Open Air Film Festival promises unforgettable nights to movie loversPanos - May 28, 2020
The Athens Open Air Film Festival promises movie goers unforgettable cinematic experiences as the summer event organised for the tenth…
PM Mitsotakis welcomes European Commission aid proposal for coronavirus falloutPanos - May 28, 2020
Greek Prime Minister Kyriakos Mitsotakis welcomed the European Commission’s proposal for a 750 bln euro aid package to fight the…