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Is Turkey “City Zero” in Global Contagion
Is Turkey “City Zero” in Global Contagion Last year Turkey’s lira crisis quickly morphed into a Euro-zone crisis as Italian bond yields blew higher and the euro quickly reversed off a major Q1 high near $1.25. It nearly sparked a global emerging market meltdown and subsequent melt-up in the dollar. This week President Erdogan of […]
On The Edge Of Collapse: Turkish Lira Plummets As Central Bank Burns Through A Third Of Reserves
On The Edge Of Collapse: Turkish Lira Plummets As Central Bank Burns Through A Third Of Reserves The Turkish lira resumed its plunge on Thursday following a sharp rebound on Tuesday when Turkish authorities unleashed an unprecedented assault on lira shorts, helping push the TRY briefly higher ahead of regional elections, after a disappointing reading […]
Turkey On Verge Of Collapse As Overnight Swaps Hit 700%, CDS Soar
Turkey On Verge Of Collapse As Overnight Swaps Hit 700%, CDS Soar In Turkey’s ongoing attempt to crush currency manipulators, yesterday we reported that in addition to launching a “probe” against JPMorgan, the biggest US bank, for daring to cut its TRY price target, as well as threatening unnamed “manipulators”, on Monday Turkish authorities took a page […]
Turkish Lira Tumbles As Tanks Amass Along Syrian Border
Turkish Lira Tumbles As Tanks Amass Along Syrian Border After an already painful start for the Turkish lira this year, shedding more than 3.5% of its value against the dollar during the first three days of 2019 when it flash crashed after Mrs Watanabe puked on the carry trade after Apple shockingly guided lower, and after […]
Loans Sour in Turkey, Inflation Hits 25%, Interest Rates Spike, Fears of Contagion Rise
Loans Sour in Turkey, Inflation Hits 25%, Interest Rates Spike, Fears of Contagion Rise The economic miracle fueled by foreign-currency debt. The Bank of Turkey’s decision mid-September to hike its policy rate from 17.75% to 24% may have temporarily stemmed the rout in the Turkish lira, but the hiatus is now over. This week, the […]
“Shocking” Turkish Inflation Hits 15 Year High, Unleashing Stagflationary Shockwave; Lira Plunges
“Shocking” Turkish Inflation Hits 15 Year High, Unleashing Stagflationary Shockwave; Lira Plunges A few days ago we discussed how soaring oil prices have been a stagflationary double whammy to emerging markets, which have been hit not only by a surging dollar, resulting in a collapse in local currencies and spiking import costs, but a spike […]
Turkish Banks Liquidate Gold In Currency Crisis Panic
Turkish Banks Liquidate Gold In Currency Crisis Panic At the peak of the Turkish currency crisis in mid-August, in addition to general concerns about the state of the local economy, one sector got hit especially hard: Turkish banks, which saw their bonds plunge amid growing concerns that the currency slump would makes it impossible for […]
What Turkey Can Teach Us About Gold
What Turkey Can Teach Us About Gold If you were contemplating an investment at the beginning of 2014, which of the two assets graphed below would you prefer to own? Data Courtesy: Bloomberg In the traditional and logical way of thinking about investing, the asset that appreciates more is usually the preferred choice. However, the […]
Peso, Rand Plummet As Emerging Market Crisis Deepens
Peso, Rand Plummet As Emerging Market Crisis Deepens The EM contagion is slamming currencies around the globe, and while the Turkish Lira remains relatively immune for the time being, traders are now focusing their attention on the South African rand and the Argentine peso, both of which are in freefall this morning. The ZAR has […]
Turkey Inflation Soars To 15 Year High As Central Bank Pledges Imminent Rate Hike
Turkey Inflation Soars To 15 Year High As Central Bank Pledges Imminent Rate Hike With the Turkish lira plunging, it was not exactly a surprise that Turkish inflation data reported today came even hotter than expected, with inflation jumping a surprising 17.9% Y/Y in August, up from 15.9% and above the 17.6% consensus, with monthly […]
Lira Plummets After Turkish Central Bank Deputy Governor Quits
Lira Plummets After Turkish Central Bank Deputy Governor Quits It was already an ugly day for the Turkish Lira, which earlier in the day accelerated its drop for the 4th consecutive session, sending the USDTRY to the highest level since August 14 when the currency crashed over the weekend to the lowest level on record. […]
Turkey’s Crisis and the Dollar’s Future
Turkey’s Crisis and the Dollar’s Future Last week’s collapse of the Turkish lira has dominated the headlines, and it is widely reported that this and other emerging market currencies are in trouble because of the withdrawal of dollar liquidity. There are huge quantities of footloose dollars betting against these weak currencies, as well as commodities […]
Weekly Commentary: Instability
Weekly Commentary: Instability With the Turkish lira down another 6.6% in Monday trading, global “Risk Off” market Instability was turning acute. The U.S. dollar index jumped to an almost 14-month high Monday, as the Turkish lira, Argentine peso, Indian rupee and others traded to record lows versus the greenback. The South African rand “flash crashed” […]
Boiling A Turkey
Boiling A Turkey There is an age old fable describing a frog being slowly boiled alive. The premise is that if a frog is put suddenly into boiling water, it will try and save itself. However, if the frog is put in tepid water which is then brought to a boil slowly, it will not perceive […]
Weekly Commentary: Turkey (Nudged Over the Cliff)
Weekly Commentary: Turkey (Nudged Over the Cliff) The Turkish lira sank 13.7% in chaotic Friday trading. The lira’s 21.0% “worst week in 17 years” collapse pushed y-t-d losses to 41.1%. Turkish 10-year yields spiked to almost 21%, before retreating somewhat. After beginning the year at 155, Turkey sovereign credit default swaps (CDS) spiked 166 bps […]
