The Central Bank of the Republic of Turkey (CBRT) surprised the economists at TD Securities, by cutting the word “only” 50bps. With the initial reaction, the USD/TRY pair has pulled away from session highs and were last seen trading at 6,8028.
The key is what others have said
“The CBRT has announced that it has lowered its policy (one-week repo) by 50 basis points. The movement, which is designed as a measured cut in the policy rate of 8.25 per cent today, instead of the 100 that we had penciled in.”
“The fact that the USD/TRY has recently marked a new all-time high, or 7.2690 May 7 May have to do with an approach that is more conservative today than in the last matches.”
“In The medium-and long-term economic and financial outlook for Turkey remain relatively dark, in our view, particularly as the policies are still too oriented towards growth. But for the short term, the USD/TRY, may receive a new impulse downwards, as today’s announcement shows restraint, which suggests that the easing cycle may be close to the end.”