Turkish lira hits new lows amid political worries

By bne IntelliNews November 7, 2016

The Turkish lira’s rally against major currencies in the early morning hours of November 7 was short-lived as heightened political tension took its toll on the currency that hit a new low later in the day to trade at 3.1797 against the US dollar as of 1900 Istanbul time.

In early trading on November 7, the lira gained some ground on the news that S&P upgraded Turkey’s rating outlook to positive from negative. But, political worries following the arrests of opposition lawmakers proved stronger and the lira dropped 0.7%. That brings the currecy's fall since the July's coup attempt to over 9%The main stock exchange index, BIST-100, was up 2.03%.  

Pro-Kurdish opposition party HDP decided to halt all legislative activity in parliament after nine of its lawmakers, including co-chairs Selahattin Demirtas and Figen Yuksekdag, were arrested on November 4. The HDP is not fully withdrawing from the parliament but its members will not take part in commission meetings and sittings. Commenting on the HDP’s latest move, Deputy Prime Minister Numan Kurtulmus said on November 7 that the government is not expecting an early election.

By-elections should be held if 5% or 28 seats in parliament become vacant. The HDP has 59 deputies in the 550-seat parliament.

Meanwhile, relations between Ankara and Brussels remain tense. The EU should change its stance on Turkey following the government’s recent harsh measures and stop the flow of billions of euros in aid if Ankara fails to stick to its migrants deal with the bloc, Austrian Foreign Minister Sebastian Kurz said on November 7, AFP has reported, according to the Hurriyet Daily News. “Over recent years Turkey has moved further and further away from the EU, but our policy has remained the same. That can’t work. What we need are clear consequences,” he said.

Later this week, the EU is expected to release its annual report on Turkey, which is said to be highly critical of Ankara. Turkey defends its measures against the HDP and the sweeping purges of supporters of US-based cleric Fethullah Gulen in the wake of the failed July 15 coup attempt on the ground that they pose serious threats to the country’s national security.

Related Articles

Erdogan says he plans talks with lenders on cutting Turkish interest rates

Turkey's President Recep Tayyip Erdogan said on October 13 that he plans to hold talks with both public and private lenders on how to lower interest rates. He did not say, however, when those ... more

Turkey's Erdogan turns fire on US ambassador in diplomatic spat over arrest

Turkish President Recep Tayyip Erdogan has turned his fire on the US ambassador to Turkey for the ... more

Turkey-based Eurasian development bank ETDB signs memo to boost return to Iran

The Central Bank of Iran (CBI) and the Turkey-based ECO Trade and Development Bank (ETDB) have signed a memorandum on strengthening bilateral ties, the CBI said on October 10. ETDB is a Eurasian ... more

Dismiss