Turkish Lira Tumbles 5 Percent, Central Bank Acts On Swap Limits

[pinto + 293]

The Turkish lira plunged as much as 5 percent against the dollar on Thursday as investors continued to fret about moves by Turkish authorities to withhold lira liquidity from the London market.The central bank has made a series of moves to underpin the lira this week and bankers said it took a fresh step on Thursday, raising its total lira swap sale limit to 30 percent from 20 percent for swap transactions that have not matured. It had raised the limit to 20 percent on Monday from 10 percent in a move aimed at increasing the bank’s forex reserves, which fell sharply in the first two weeks of March. Those falls have raised uncomfortable questions about Turkey’s balance of payments and its ability to roll over foreign loans - and how and from whom it would seek emergency reserves if necessary.Such rates are a huge hurdle to foreign investors looking to bet against the lira, to hedge or close out positions. They have thus sold off holdings in Turkish stocks and bonds which have came under heavy pressure this week.

[Pavel + 384]

JP Morgan...Time to get in!

[damirUSBiH + 327]

When the Erdogan came Turkey was 17th biggest economy in the world, now they are 19th. Dolar was 1.40 lira, now is 5.80 . Enough..

[francoba + 93]

Let's say: on the edge of collapse

[ThunderBlade + 231]

World wide gold standard for currency would stop all control by the central banks. Pull their power.

[Pavel + 384]

3 minutes ago, francoba said:

Let's say: on the edge of collapse

The big problem for Turkey remains high inflation, which is just under 20%.. Of course, higher inflation is fuelled by a weaker currency, but in same time  high inflation in itself then causes more lira falls. Bad days for regime.

[rainman + 263]

They have local election at the weekend- I hope voters will punish Erdogan's catastrophic economic policy...

[pinto + 293]

Despot Erdogan is on track to lose country completely..