Turkish Lira Falls to New Low Against US Dollar

The Turkish lira on Tuesday reached a new historic low against the US dollar, trading at over 33 liras per dollar. At 12:37 p.m. local time (0937 GMT), the exchange rate was 33.01 liras per dollar, later stabilizing at 32.96 liras in the afternoon.

Throughout the day, the lira fell by 0.13% against the dollar, marking an approximate 11% decline since the beginning of the year. The latest Market Participants Survey on exchange rates predicts that the lira will drop further to 37.75 per dollar by the end of the year.

All eyes are on the Turkish Central Bank as it is set to announce its interest rate decision on Thursday. Economists unanimously expect the policy interest rate to remain at 50%. In May, the central bank had also kept the interest rate steady at 50%, aligning with market expectations.

Turkey has been battling high inflation for a long time, with the rate soaring to 75.45% in May. In response, the government has implemented several measures, including maintaining a tight monetary policy and high interest rates.