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Turkish lira recovers

Orient Net 2018-08-16 09:38:00

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The Turkish lira rallied 3 percent on Thursday (August 16) ahead of a presentation by Finance Minister Berat Albayrak to investors, shrugging off US comments ruling out the removal of steel tariffs on Turkey even if it frees a US pastor.

The lira gained some support from the announcement late on Wednesday of a Qatari pledge to invest $15 billion in Turkey and Albayrak will be looking to reassure investors in his conference call at 1300 GMT.

The lira, which has weakened 34 percent against the dollar this year, firmed to 5.7500 against the dollar by 0722 GMT from a close of 5.95.

It has rebounded sharply from a record low of 7.24 this week, benefiting from central bank steps to underpin a currency.

JP Morgan said moves by Turkish authorities showed they were committed to stabilising the currency with technical measures such as restricting forex swaps and cancelling repo auctions to push up the weighted average cost of funding.

"Yet at the same time (Turkish authorities) are reluctant to adopt orthodox policy frameworks. This could ultimately limit the efficacy of technical tools," JP Morgan said.

Investors said Albayrak’s conference call was going to be a key test of whether Turkey can convince the market that its monetary policy is not hostage to political influence.

The White House said on Wednesday that it would not remove steel tariffs on Turkey, appearing to give Turkish authorities little incentive to work for the release of Andrew Brunson, a pastor on trial in Turkey on terrorism charges.

On Wednesday, a Turkish court rejected an appeal by Brunson’s lawyer for his appeal to be released from house arrest. An upper court had yet to rule on the appeal, his lawyer told Reuters.

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