It was said that after the TL rose by 2 liras to 23 liras overnight, the exchange rate would see 25 liras. However, the record breaking dollar with 23.46 was fixed at 23.20 levels. While everyone is wondering whether the rise in the dollar will continue, the US-based financial agency Bloomberg wrote the reason for the stop of the rise.
PUBLIC BANKS RE-ACTIVATE
According to the news of Bloomberg’s Kerim Karakaya, Çağan Koç and Beril Akman entitled “Turkish public banks are back to defending TL after the sharp fall”, public banks have stepped in again today to curb the increase in the dollar exchange rate. Yesterday, the Ministry of Treasury and Finance, led by Mehmet Şimşek, suspended the practice of public banks’ intervention in the exchange rate by selling foreign currency from the Central Bank’s (CBRT) reserves, but the intervention started again after the increase in the exchange rate exceeded 6 percent.
SUSPENSION DETECTED AS NORMALIZATION SIGNAL
The suspension of the application, albeit temporarily, and the increase in the dollar rate were perceived as a “normalization signal” by foreign investors. Today, the increase in the exchange rate was limited due to the re-entry of public banks and the exchange rate, which was 23.17 yesterday, is at 23.37 as of 14.38 today.
TURKEY’S CREDIT RISK PREMIUM INCREASED
Turkey’s credit risk premium (CDS) started to rise again with the public banks’ return to the exchange rate intervention policy today, rising from 483 basis points yesterday to 516 basis points today. Thus, CDS rose for the first time in June.