Dollar The exchange rate continues its upward trend on the second trading day of the week after the management change at the CBRT.
After the increase in the interest rates of the 10 years in the USA, the CBRT’s interest rate increase of 200 bps, which was above the expectations, pulled the dollar rate to 7.20 in March.
After the change of the flag in the CBRT, the dollar rate decreased to 7.70 after testing 8.50, and it could not be permanent here.
Starting the week at 8.07 level, the exchange rate is trading at 8.27 TL on the morning of 30 March. Although the spot gold price decreased while the euro / TL rose above 9.70, the gram gold price was above 450 TL due to the increase in the exchange rate. Turkey’s 5-year CDS is testing the 465 level.
While the 10 years in the USA reached the highest level of the last 1 year with 1.74, the dollar index reached 93. Turkey’s 10-year bond yields also came from 14 percent to 20 percent.
However, analysts point out that the focus in exchange rate pricing has shifted from the global bond market to a possible change in domestic monetary policy.
During the period of Former President Ağbal, the CBRT increased the interest rate by 875 bp by adopting a tight monetary policy, and the rising exchange rate, which peaked at 8.58 in November 2020, dropped to 6.90 before the rise in US bond rates. Ağbal stated that tight monetary policy will continue until price stability is achieved.
While the possibility of the interest rate cuts to start earlier than expected after the new President Şahap Kavcıoğlu was priced, Kavcıoğlu said in a written interview with Bloomberg, “I do not find a biased approach that the interest rate will be reduced immediately regarding the MPK decision in April or the following months”.
In his written interview, Kavcıoğlu stated, “While determining the monetary policy stance, we will take into account global capital flows, real returns of similar countries and portfolio preferences of residents together with the actual and expected inflation”.
On the other hand, while the Vice President of the CBRT, Murat Çetinkaya, was dismissed by the Presidential Decree, Morgan Stanley Securities General Manager Mustafa Duman was appointed instead.
While the global markets are going through a short week due to Easter, the CBRT Ordinary General Assembly to be held today will be watched.
–
