The Lira Is No Turkish Delight!
14 August, 2018
Monday saw further turmoil for the ailing Turkish Lira which has been crumbling in recent months due to political uncertainty. On Friday President Trump doubled the tariffs the US would impose on Turkish imports sending the Lira into free-fall, heading over the 8 to the pound mark. Yesterday that turmoil continued as we saw further losses for the Lira, as it headed up towards 9 to the pound.
With no data for investors to go on, it was all about the volatility from Turkey, with the euro initially losing ground as markets feared EU banks exposure to the Turkish banks in crisis. This seemed to fizzle out though as the day went on as the Turkish Central Bank offered its full support to their banking system to see them through the current troubles.
The US dollar also gained back against sterling having seen some better rates for those buying dollars as we saw safe haven trading come into play, again, all to do with the situation in Turkey.
Trading against both the euro and US dollar stayed within thin ranges on Monday and with more volatility from Turkey likely today we could see much of the same. We do have German inflation figures, EU GDP and UK unemployment and average earnings figures to contend with this morning though so could see some sterling/euro movement this morning depending on the figures and whether investors actually take them into account, or just move on risk aversion while the uncertainty in Turkey continues.
With all the current volatility, do give the team a call for some friendly guidance on your upcoming transfers.
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