Lira holds against US dollar, bearly, as Turkey's runoff elections approach
ALBAWABA – The Turkish Lira slipped slightly against the United States (US) dollar to TRY20.06 on Friday but quickly rose back to TRY19.978 ahead of the Turkey runoff elections on Sunday, news outlets have reported.
This is the third time in the weeks leading up to the elections that the Lira has fallen beyond the TRY20 barrier, only to quickly retain its value at slightly over the historical threshold.
Less than a week ago, Turkey’s Lira suffered a similar decline, but quickly restored itself at TRY19.8275, Bloomberg reported on May 22.
Overall, the Lira has fallen 6.3 percent since the beginning of the year, according to Reuters.
The ongoing elections have amplified the fluctuation of the national Turkish currency, news and media outlets reported. More so with elections run-off between President Incumbent Recep Tayyip Erdogan and his opposition rival Kemal Kilicdaroglu.
Neither one of the candidates was able to secure the constitutionally mandated majority to be formally elected president. Erdogan was close, with a little over 49 percent, and his rival just shy of 45 percent of the votes, according to Al Jazeera.
The two rivals bear opposing views on economic policy, with Kilicdaroglu representing a more conventional approach.
Meanwhile, Erdogan has been leading on the economic front with a series of unorthodox policies and decisions.
Turkey’s financial markets were unsettled by Erdogan’s strong performance on May 14, according to the Financial Times.
Investors are increasingly concerned that Erdogan, will continue to pursue unconventional policies that economists blamed for triggering runaway inflation and the deep slide in the lira, the Times said.
Under his presidency, the Lira lost 44 percent of its value in 2021 and 30 percent in 2022, according to Investing.com. Inflation also soared in Turkey, with the weekly rate of the Turkish Lira’s inflation reaching 17.2 percent Friday, May 19, and 30 percent last Monday, May 22.
