|Day's Range||0.147 - 0.147|
|52 Week Range||0.1376 - 0.1835|
The Turkish lira fell to a record low against the U.S. dollar this week and reports say the government has tried to stop the slide by taking action against three foreign banks.
Traders are turning far and wide for more current data on the economy than what the government provides, as they assess how deep the recession is and the degree and speed to which it will recover. Scheduling software company Homebase has been providing data on employment and hours worked on a daily basis during the crisis, which is a particularly useful real-time economic indicator because its customers are in the restaurant, food and beverage, retail and services businesses, where the job losses have centered. The bad news is that employment on May 5 was down 51% from pre-shutdown levels, but the good news is that employment on the worst day, April 12, was down 74%, according to the Homebase figures.
The Turkish lira hit its lowest level against the U.S. dollar on record, as investors bet that the economic pain from COVID-19 exerted on the emerging economy may be too severe for its central bank to ease. At last check, the Turkish lira was off 0.8% against the dollar, changing hands at 7.2428. The currency has fallen 2.2% so far this week and 17.24% in the year to date against the greenback, FactSet data show. The currency breached a level in intraday action at 7.2362 that represents its lowest against the dollar since 2018, which had been its previous nadir. The country's finance minster, Berat Albayrak, son-in-law of the Turkish President Recep Tayyip Erdogan, has insisted that the country will rebound and rejected a report from the International Monetary Fund that it is likely to fall into a deep economic recession, the Financial Times reported, citing people familiar. The Wall Street Journal reported that Turkey entered the pandemic already in a weakened state, with high inflation and anemic growth. Meanwhile, the exchange-traded iShares MSCI Turkey ETF , which gives investors exposure to the country, was down 2.2% this week so far and 30.2% thus far in 2020, according to FactSet data.
Sterling rallied after the Bank of England left interest rates steady and held off on more stimulus. It has been hurt by Tuesday's ruling from Germany's highest court that gave the ECB three months to justify purchases under its bond-buying programme or lose the Bundesbank's participation in one of its main stimulus schemes.
The euro inched up after three days of selling on Thursday, but traders remained cautious amid concern over the European Central Bank's stimulus scheme following a German court ruling this week. Sterling rallied after the Bank of England left interest rates steady and held off on more stimulus.
Developing world stocks started the week on softer footing on Monday, as a sharp rise in the death toll from the coronavirus outbreak in China kept a lid on buying, while Turkey's lira found stability in measures taken by a banking watchdog. The epidemic in China recorded a death toll of 97 on Sunday, the largest in a single day since the outbreak was detected in December.
The Turkish lira overnight swap rate in London jumped to 65% on Monday from 9.5% at the end of last week when the country's currency came under pressure and hit its weakest level in eight months, according to Refinitiv data. London lira overnight rates had come into focus last year after rocketing to more than 1,200% in April with Turkish banks withholding liquidity from London markets when the currency came under pressure in the run up to local elections. The BDDK bank regulator cut the limit for Turkish banks' forex swap, spot and forward transactions with foreign entities to 10% of their equity from a previous limit of 25% set in August 2018.
The Turkish lira's real exchange rate is competitive at the moment, Central Bank Governor Murat Uysal said on Thursday, adding that the "dollarization" trend of Turks turning to more stable foreign currencies will continue to fade. The central bank does not have a lira exchange rate target, Uysal said at a press conference in Ankara, adding that he expects the relatively stable trend in foreign currency prices to continue.
Investing.com - The pound was lower on Friday as confusion over whether or not the U.K. will leave the European Union next week continued, as the EU failed to reach an agreement on a Brexit extension.
Investing.com -- The British pound headed lower again in early trade on Tuesday after a warning that a Hard Brexit could deliver a 100-billion pound blow to public finances.
BoJ Governor mentioned that the Bank would make necessary adjustments in the monetary policy to attain its inflation target. After facing a severe pullback on July 5, the EUR/USD pair had appeared to cling near 1.1228 mark.
Investing.com -- The dollar was slightly lower in early morning trading in Europe, but holding on to most of the gains it posted after Friday’s stronger-than-expected U.S. employment report forced a rethink on the Federal Reserve’s future interest rate path.