- USD/TRY keeps rising post-Erdogan win on Sunday.
- The lira has already depreciated nearly 8% this year.
- President Erdogan vowed to keep low-rates policy.
The Turkish lira remains in free-fall vs. the greenback and lifted USD/TRY to a new all-time high near 20.25 on turnaround Tuesday.
USD/TRY: Further gains appear in store
USD/TRY advances for the third session in a row and flirts with the 20.25 region, as investors continue to assess Sunday’s win by President R. T. Erdogan in the second round of the general elections.
Extra weakness hitting the lira comes after President Erdogan promised to keep the current low-rate policy as the main tool to tackle the elevated inflation (against all economic theory), in a context where the country’s FX reserves do everything but grow and the current account deficit flirts with its widest in the series history.
It is worth noting that the pair has closed with gains in every single week since March 1.
Later on Tuesday, Trade Balance figures for the month of April will be the sole release in the domestic docket ahead of Q1 GDP results on Wednesday and the Manufacturing PMI on Thursday.
USD/TRY key levels
So far, the pair is gaining 1.18% at 20.2474 and faces the next hurdle at 20.2486 (all-time high May 30) followed by 21.00 (round level). On the downside, a break below 19.3941 (55-day SMA) would expose 19.1352 (100-day SMA) and finally 18.8185 (200-day SMA).