On June 24th, 2018, Turkish President Recep Tayyip Erdogan was re-elected for a second term in office. This news has had a significant impact on the Turkish lira, which has been in a state of turmoil for the past few years. The USD/TRY exchange rate has been pushed towards a new record high above 20.00, causing concern among investors and economists alike.
The Turkish lira has been under pressure for some time due to a number of factors, including political instability, high inflation rates, and a large current account deficit. The country’s economy has been struggling to recover from a currency crisis that began in 2018, which saw the lira lose more than 30% of its value against the US dollar.
Erdogan’s re-election has added to the uncertainty surrounding the Turkish economy. Many investors are concerned about the president’s economic policies, which have been criticized for being too interventionist and for undermining the independence of the central bank. Erdogan has also been accused of using his power to suppress dissent and limit freedom of speech, which has led to concerns about political stability in the country.
The impact of Erdogan’s re-election on the USD/TRY exchange rate has been significant. The lira has lost more than 10% of its value against the US dollar since the election, pushing the exchange rate above 20.00 for the first time ever. This has made imports more expensive for Turkish consumers and businesses, which could lead to higher inflation rates and slower economic growth.
The Turkish government has taken steps to try and stabilize the lira, including raising interest rates and implementing fiscal reforms. However, these measures have not been enough to prevent the currency from depreciating further. Some analysts believe that the government will need to take more drastic action, such as seeking assistance from international organizations like the IMF, in order to restore confidence in the Turkish economy.
In conclusion, Erdogan’s re-election as Turkish President has had a significant impact on the country’s economy and the USD/TRY exchange rate. The lira has been under pressure for some time due to a number of factors, and the uncertainty surrounding Erdogan’s economic policies has only added to the problem. It remains to be seen what steps the government will take to address these issues and restore confidence in the Turkish economy.
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- Source: https://zephyrnet.com/usd-try-eyes-fresh-record-high-above-20-00-as-erdogan-again-wins-turkish-presidential-election/