USD/TRY resumes the upside, still well above 13.0000

• USD/TRY fades Wednesday’s downtick and refocuses on the upside.
• The CBRT signalled it has no plans to reduce rates in H1 2022.
• Key Turkey’s inflation figures are due on Friday.

The lira resumes the downside and prompts USD/TRY to continue the rally to the 13.5000 region on Thursday.

USD/TRY looks to CBRT, data

Following Wednesday’s pullback, USD/TRY now regains upside traction and approaches the mid-13.00s on the back of further effervescence in the domestic political arena.

Indeed, earlier on Thursday, President Erdogan appointed N.Nebati as the new Minister of Treasury and Finance after the resignation of former minister L.Elvan, who was an advocate of the orthodox approach to the monetary policy.

In addition, S.Kavcioglu, Governor of the Turkish central bank (CBRT), suggested that investors will see the impact of the current monetary policy stance in H1 2022 and added that there are no plans to cut the One-Week Repo Rate further during that period. Kavcioglu, in addition, noted that companies’ investment appetite and employment expectations remain at high levels, while the improvement in the current account balance became clearer.

In the docket, Turkish Exports rose to $21.50B in November (from $20.8B). All the attention, in the meantime, remains on the release of the inflation figures for the month of November, due on Friday.

USD/TRY key levels

So far, the pair is gaining 2.07% at 13.3935 and a drop below 12.3585 (low Dec.1) would open the door to 11.5451 (low November 24) and finally 11.2500 (20-day SMA). On the other hand, the next up barrier lines up at 13.8473 (all-time high Dec.1) followed by 14.0000 (round level).