USD/TRY rebounds to $9.2400 ahead of CBRT Interest Rate Decision
|- USD/TRY consolidates weekly losses near record top, sidelined of late.
- Fitch says Turkey’s ‘premature’ rate cut risks higher inflation.
- Turkish President Erdogan lauds global investor confidence in Turkey.
- CBRT is up for another rate cut, Turkish Consumer Confidence and US data important too.
USD/TRY picks up bids around $9.2430, up 0.33% intraday ahead of Thursday’s European session. In doing so, the Turkish Lira (TRY) pair pares weekly losses ahead of the key monetary policy meeting of the Central Bank of the Republic of Turkey (CBRT).
The pair’s rebound could be linked to the comments from the global rating agency Fitch. “Turkey's interest rate cut last month risks pushing inflation higher than Fitch Ratings' estimate of 17.2% by year end,” said Fitch per Reuters.
The news also mentions the fact that President Recep Tayyip Erdogan has abruptly ousted the last three central bank governors and last week he fired three bank policymakers including two seen to oppose the September rate cut.
It was additionally mentioned, “Sources close to the presidency have told Reuters that Erdogan had pushed for monetary stimulus for months with the aim of boosting lending, exports and jobs.”
Even so, Turkish President Erdogan said, per Reuters, “International investors place their trust in Turkey, believing in its potential and bright future. President Erdogan addressed the party members at the AK Party Adana Extended Provincial Consultative Meeting.”
The US Dollar Index (DXY), on the other hand, refreshes a three-week low amid market optimism and a lack of directives ahead of Friday’s preliminary reading of October’s PMI data.
Looking forward, USD/TRY moves rely on the CBRT Interest Rate Decision, expected 17.5% versus 18.0% prior. Also important will be Turkey’s monthly Consumer Confidence data for October, prior 79.7. Although its least expected that the CBRT will defy the market forecast of a rate cut any surprises won’t be taken lightly.
Following that, US Jobless Claims, Philadelphia Fed Manufacturing Index and Existing Home Sales may entertain the pair traders.
Technical analysis
Overbought RSI conditions challenge USD/TRY recovery towards the all-time high of $9.3765. On the contrary, the 10-DMA near $9.1670 offers immediate support.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.