Turkish Lyra Currency Conversion

Posted onDecember 22, 2011 - 1:26 am by Admin | 0 Comments

ISTANBUL, Dec 21 (Reuters) - The Turkish lira firmed versus the dollar on Wednesday and the benchmark bond yield declined after the central bank announced it would sell large amount of dollars in forex auctions this week in a move to support the ailing currency.

Investors are also monitoring the bank's monthly monetary policy meeting on Thursday.

The Turkish Central Bank said on Tuesday it will sell a maximum $1.7 billion in its daily forex-selling auctions on Wednesday and Thursday.

By 0817 GMT, the lira traded at its strongest level in a week at 1.8755 versus the dollar, nearly a half percentage point compared with 1.8838 on Tuesday.

The currency has lost nearly 23 percent versus the greenback this year and touched a three-week low of 1.9065 on Monday as local companies bought dollars and investors worldwide sought safety ahead of the year-end.

'The central bank will likely to continue increasing its forex sale amounts and this would be enough to avoid further depreciation in lira,' wrote Erkin Isik, a strategist at TEB-BNP Paribas.

Against a euro-dollar basket the lira traded at 2.1699, compared with a previous close of 2.1720.

'The central bank's announcement of large amounts to sell in forex auctions seems to ease the pressure (on the lira). However, the exact amount that the bank will sell would be more determinant,' wrote Fatih Keresteci, a strategist at HSBC.

The bank could opt to sell less than the amount announced within the framework of its forex selling auctions strategy.

The yield on Turkey's new benchmark bond maturing on Dec. 4, 2013 stood at 10.30 percent, compared with a previous close of 10.48 percent.

'Today markets will monitor the housing data from U.S. and three-year liquidity operation from the European Central Bank... We expect the benchmark yield to fluctuate between 10.20-10.60 percent,' wrote TEB analysts in a note.

Volumes on the bond markets are expected to remain thin, analysts said.

Istanbul's main share index was up 0.75 percent at 52,516 points, underperforming the MSCI emerging markets index , which was up 2 percent.

Turkish markets have in their sights the central bank's monthly monetary policy committee meeting on Thursday, at which the bank is expected to keep its policy rate unchanged.

The Turkish central bank said on Wednesday it will hold a meeting on Dec. 27 to announce its monetary and exchange rate policy for 2012.

(Writing by Seltem Iyigun) Keywords: MARKETS TURKEY/

(seltem.iyigun@thomsonreuters.com)(+90 212 350 70 53)(Reuters Messaging: seltem.iyigun.thomsonreuters.com@reuters.net)

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by Jon Beddell

Foreign Currency Market Update – GBP / TRY Update

The much awaited European bank stress tests were completed on Friday. All major banks passed the tests including the four major UK banks that took part. Also giving the pound a boost on Friday was a strong second quarter GDP figure. Growth came in at 1.1%, nearly double the 0.6% that analysts had been expecting. Also beating market expectations were June retail sales, which rose 0.7% against 0.5% expected.

Tempering the positive mood a report from Hometrack showed a 0.1% fall in house prices in July, and predictions of further modest price falls in the second half of the year. A general feeling that the government’s austerity measures will dent growth is also lingering over sterling and limiting gains.

Turkish central bank governor responded to criticism last week as exporters argued that the Turkish currency should be fixed rather than free floating. Arguing that in real terms the currency index has been relatively stable since 2003, the governor said that “Turkey has protected its competitive force in foreign trade.”

David Cameron was in Turkey yesterday meeting his counterpart, and delivered a speech strongly backing Turkey’s bid to join the EU.

Data for the week ahead is light on the UK front, with mortgage approvals and consumer confidence figures likely to attract the most scrutiny on Thursday. On the other side of the channel the main items are German retail sales (Tue’) inflation data (Wed’) and unemployment (Thur’).

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  5. Daily Foreign Exchange Rate Forecast – 20th July

Tags: Turkish Lira
Category GBP-TRY Update


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