USD/TL hit its highest level for the year after US inflation

As inflation in the US failed to show the expected decline in the last month, expectations that the Fed will continue with front-loaded rate hikes have increased. While a 75 basis point rate hike is almost certain at this month's meeting, the probability of a 100 point rate hike has approached 20%.

The US dollar strengthened this week with rising interest rate expectations. The dollar index rose to 110 yesterday with a gain of over 1%. With the rise in the dollar, the euro/dollar fell below 1 again, while sales accelerated in developing country currencies. The dollar / TL, which has been traded in a very narrow band above 18.20 in recent weeks, reached 18.27 yesterday after the US inflation. The exchange rate tested this year's peak by reaching 18.2834 in the Asian session. After consumer prices in the US, producer prices will be announced today. If production costs remain high, it may further strengthen interest rate expectations as it will increase the risk of ossification of inflation. Today, when there is no important data release in Turkey, the global pricing of the dollar is expected to be effective on the exchange rate. The dollar exchange rate hit a historical high of 18.36 on December 20. Follow Global Economic Developments on Social Media! Click here to follow Ieconomy official Facebook account! Click here to follow Ieconomy official Instagram account! Click here to follow Ieconomy official Twitter account!