The Turkish lira continued to devastate after Party Recep Tayyip Erdogan had lost control of key cities after Sunday's election. Investors are worried that the authorities will weaken the money even more, depending on popular policies, writes Bloomberg.
In the early Asian trade, the currency lost up to 1 per cent of its value, and later it was partly recovered and traded 0.2 per cent lower.
The Turks sold pounds for $ 4 billion, which were frightened by the forthcoming elections
Deposits in dollars are already 50% of the total
The preliminary results show that the opposition wins the capital of Ankara and the management of the cities on the Mediterranean coasts, which so far have been controlled by the party of Erdogan. For now, it cannot be said who won in Istanbul, as the ruling candidates and the opposition declared a victory.
Coface: Turkish lira remains vulnerable and imports will be further reduced
Private consumption, which accounts for almost 60% of GDP, has fallen by 8.9% yoy
In a short message, Erdogan said that there was an "important reform plan" for Turkey, and a Turkish wave collapsed in August, pushing inflation over 20 per cent and falling the economy to its first recession since the global crisis. wide.
The central bank has made it clear that it will make it possible to calm prices, but investors are worried that the government will now be looking for a broad policy that has the potential to keep inflation at levels. four times the official target.
Before a Sunday vote, state-owned banks were already under pressure to borrow cheap loans, and opened a number of tax cuts aimed at boosting domestic hole use in the budget.
At the same time, the unsatisfactory demand for foreign currency, mainly dollars, by local investors had increased the weakness of the pound. Households and companies have added foreign currency deposits worth around $ 28 billion over the last half year.