Turkish Lira after elections: Will it crash, or soar?
[embed]https://www.youtube.com/watch?v=O6b5mxF3Ab8&t=17s[/embed]
- Turkey’s dual elections scheduled for 14 May is not only generating immense political frictions at home, but also spills over to the economy.
- A major for economic agents is whether CBRT’s implicit peg on the exchange rate will be maintained.
- Recently, a slew of reports and analyses concluded that TL is doomed to fall significantly after the elections, no matter which camp emerges victorious.
- Bizarre events can never be ruled out in Turkey, but if the opposition sweeps to victory, there is no sentimental or fundamental reason for TL deprecation.
- In Erdogan and allies win once again, Turkey will say farewell to a free currency market, reverting to “capital controls”.
Sources used in this broadcast
S&P downgrades Turkey’s outlook, updates dollar/TL forecast
https://www.paturkey.com/news/sp-downgrades-turkeys-outlook-updates-dollar-tl-forecast/2023/
News Analysis: Turkish lira may continue to weaken after general elections in May, experts say
http://english.news.cn/20230329/8ec389c732e94d699f964fbc9e45e0c0/c.html
Turkey Is Shunned by Emerging-Market Hedge Funds Before Vote
https://www.bloomberg.com/news/articles/2023-03-29/turkey-is-shunned-by-emerging-market-hedge-funds-before-vote
Turkish Lira to Weaken No Matter Who Wins Elections, Bank of America Analysts Say
https://www.bloomberg.com/news/articles/2023-03-30/bofa-sees-turkish-lira-devaluation-no-matter-who-wins-elections
Bond Traders Trim Bearish Turkey Bets on Possible Erdogan Defeat
https://www.bloomberg.com/news/articles/2023-03-31/bond-traders-trim-bearish-turkey-bets-on-possible-erdogan-defeat?srnd=premium
Foreign investors test Turkey's waters after years in the cold
https://www.reuters.com/world/middle-east/foreign-investors-test-turkeys-waters-after-years-cold-2023-03-24/
TL4
