USD/TRY collapses nearly 3% to 3.7500

The Turkish Lira is finally seeing some relief today, with the USD/TRY losing almost 3% to the 3.7500 neighbourhood.

USD/TRY lower on politics, dollar

The selling pressure stays unabated around the buck so far this week, particularly intensified after yesterday’s press conference by US president-elect Donald Trump.

Adding to TRY strength, Turkish president Erdogan increased his rhetoric on speculation in the FX markets as a mean to attack the country, adding that the central bank ‘has the necessary tolls and ability to take measures on this’.

It is worth mentioning that the Lira reached an all-time low vs. the greenback on Wednesday at levels above the 3.9400 handle, or nearly 12% lower than the close on January 2, and it had the second worst performance behind the Argentine Peso during the last year.

Geopolitical risks, higher inflation figures and the omnipresent conflict between the government and the central bank appear, however, as the main headwinds facing TRY for the foreseeable future.

USD/TRY key levels

At the moment the pair is losing 2.65% at 3.7621 and a break below 3.7058 (low Jan.10) followed by 3.6370 (low Jan.9) and then 3.5902 (20-day sma). On the upside, the next hurdle lines up at 3.9291 (today’s top) followed by the historical high at 3.9423 (Jan.11).