Turkish lira slides 2% amid reserves concerns
Turkey’s currency slumped 2% against the dollar Wednesday as concerns linger over Central Bank policies and depleted reserves.
ISTANBUL – Following months of relative stability, Turkey’s currency is once again volatile as the lira fell 2% against the dollar Wednesday.
The Turkish lira was trading at 7.04 per dollar at 6 p.m. Istanbul time. The slump is likely linked to ongoing concerns over depleted reserves, which have been used to prop up the currency, along with rising foreign debt obligations.
The news comes after the dollar fell to its lowest value in a decade last month. Analysts now believe current trends could bring about a financial crisis if the Turkish Central Bank does not implement new monetary policies.
“There is a capital outflow,” Atilla Yesilada, a political analyst at Global Source Partners, told Al-Monitor. “We have a current account deficit as well as maturing foreign debt, most of which is rolled over at this time of the year, and this automatically puts pressure on the currency.”
