Longest Weekly Decline in 9 Years in USD/TL

Dollar/TL exchange rate made the longest decrease streak since 2012 this week.

The longest weekly decline in 9 years was recorded in USD/TL. The pair has had its longest falling streak since 2012. Accordingly, the Turkish Lira completed 6 of the first 7 weeks of 2021 with a successful performance against the dollar. While dollar indicators in global markets regressed on the last trading day of the week, dollar / TL is traded at 6.96 level. Dollar/TL rate fell in 6 of the first 7 weeks in 2021. While the Turkish lira has completed the last 5 weeks by gaining value against the dollar, it experienced the longest weekly streak after the 6-week earnings streak against the dollar in early 2012. Turkey's risk premium was traded at 287 basis points, while benchmark bond interest was 14.99 percent. After the Central Bank of the Republic of Turkey's decision to keep the interest rate constant at 17 percent yesterday, while there was no visible effect on the dollar/TL exchange rate, attention was turned to Fitch's expected assessment of Turkey. Credit rating agency Fitch is expected to announce its assessment of the outlook of Turkey's credit rating and credit rating after the market shutdown. Fitch Ratings recently announced Turkey's credit rating as "BB-" in August 2020, and rearranged its rating outlook from "stable" to "negative". The organization underlined that the meltdown in foreign currency reserves and weak monetary policy credibility in Turkey during the said period increased external financing risks. In the statement regarding Turkey's credit rating by Fitch Ratings, following statements were made, “Major foreign exchange interventions were carried out to defend the Turkish Lira. Foreign currency interventions weakened policy credibility.” Changes in economic management have occurred since August 2020. However, steps to normalize economic policies were taken and the CBRT increased the interest rate by 675 points in total in the last two months of 2020.