Turkish President Erdogan continues with the opening of the Lira on the game

6 percent growth compared to the previous year: last Friday, Turkey has published the data on gross domestic product (GDP) in the fourth quarter of 2019 and pos

Turkish President Erdogan continues with the opening of the Lira on the game

6 percent growth compared to the previous year: last Friday, Turkey has published the data on gross domestic product (GDP) in the fourth quarter of 2019 and positively surprised. After the Turkish Central Bank has lowered in the past few months, the key interest rate drastically from 24 per cent to more than half, and the real interest rate turned negative, it is good news. The Plan of the Turkish President, Erdogan still, a greatly reduced key rate to boost the economy?

"was the result of This positive Surprise is about half and half on a actually stronger growth quarter-on-quarter (1.9 percent compared to the expected 1.5 per cent) and the third quarter was revised upwards," says Commerzbank expert Tatha Ghose Figures.

Lira is developing in line with regional Trends

The key question now is: Will the recovery in the Turkish economy? Ghose: "The answer depends on which faults will cause the Coronavirus in the next couple of months worldwide." To date, Turkish assets have developed values, according to the Commerzbank experts in line with global Trends.

However, the Turkish currency has plummeted in the past week massively: The Lira had lost to the Euro, a percent, a Euro was 6,6570 Lira value. Euro / Turkish Lira (EUR/TRY) 6,7976 TRY -0,0267 (EUR -0.39%) To lost OTC

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To the American Greenback, the Turkish currency, however, 0.9 percent. A Dollar was worth so 6,1588 Lira (TRY). So little is the value of the Lira against the Dollar was last updated last may. Turkish Lira / US Dollar (TRY/USD) 0,1644 USD +0,0006 (+0,40%) To files OTC

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The recent loss of value of the Turkish currency Ghose as follows: "The increase in USD-TRY could easily be misleading." Ghose puts into perspective the loss and refers to the fact, to look at the Lira rather in Relation to the Russian ruble. It is comparisons of this currency pair, will show: "The Lira has not cut off below average. In fact, the increase of the TRY-RUB is in the last days - the Outperformance of the Lira is in line with the sharp decline in the Oil price, which is negative for the ruble and positive for the Lira."

Finally, Ghose explains: "Currently, the Lira is developing in line with regional Trends. In the near term, but watch some of the key risk factors."

trade with the EU is the expert in question

the turmoil in the global manufacturing sector Should be at the steady state, the Commerzbank, should increase the conflict with Russia to Idlib or to the trade with the European Union will come to a Standstill because Turkey is wanted by Syrian refugees back to Europe, "will mutate past GDP data for accessories".

Already now the Turkish-Greek border is again the focal point: The Turkish President leaves thousands of migrants in the direction of the European Union is going to happen. Almost 10,000 refugees want to have blocked Greece within a day, at the borders of Turkey. With the SCC-exchange of letters next to values, and in the short term and the long term Top return on investment! (Partner quote) Here is an exclusive 30-day free trial!

in Addition, is no end in sight to the Coronavirus-Edipdemie. The case numbers and burden the delivery climbing chains and, thus, the international industry of massive production is not to avoid losses, it is simply a matter of how bad the loss will be.

key rate to promote low, stable Lira

According to the Commerzbank experts is also already in the February data for the Turkish consumer and producer price index, a further acceleration of Inflation. The inflation indicator for Istanbul – it is often a good early indicator finished yesterday a rise in inflation to 13 percent. At the country-wide number, it is assumed that an acceleration in the consumer price index at 12.7 per cent, while core inflation is expected to rise to 10.4 percent. Ghose: "The data are likely to strengthen us overall, in our view, according to which inflation is heading to around 14 percent. Thus, the current key interest rate of 10.75 percent is Far too low, in order to promote a stable Lira."

And even more worrying Trends have, according to Ghose reinforced: The expert refers to a dramatic decline in foreign exchange reserves - especially the free foreign exchange reserves of the Central Bank fall sharply. Ghose: "to Not forget is that the Lira crisis of 2018 was triggered by media reports about a decline in free foreign exchange reserves. That this Trend continues still, is of concern. For us, the Outlook for the Lira remains negative."

updraft for the Lira through interest rate reduction by the Fed

lift the Lira in the short term by the reduction in interest rates by the us Federal Bank. For this purpose, The combined effect Ghose: "the Fed rate cut and the surprisingly low Inflation, the Lira yesterday to rise sharply." Turkey's consumer and producer price index surprised in February to below. "Although the inflation rate accelerated in comparison to previous months, still," says Ghose, "but no longer is this growth to be as strong as the consensus fears."

read also: News Ticker to the war in Syria - According to activists: Turkey and 19 more Syrian soldiers to kill with drones, Where is Coronavirus? Real-time map showing the spread of the disease, FOCUS Online/Wochit Where is Coronavirus? Real-time map showing the spread of the disease

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Date Of Update: 04 March 2020, 12:00

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