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Turkey's Lira Weakens on Several Concerns

Turkey's Lira Weakens on Several Concerns

Saturday, 22 June, 2019 - 05:45
A man looks to a board displaying US dollars and Euros exchange rates in Turkish liras on May 23, 2018 at a exchange office in Istanbul. AFP

Turkey’s lira dropped on Friday as investors worried about the outcome of an Istanbul mayoral election on Sunday, as well as uncertainty over policymaking under President Tayyip Erdogan and possible US sanctions.

The lira stood at 5.8170 against the dollar at 1511 GMT, declining more than 1 percent from Thursday’s close of 5.7550. Earlier, it weakened as far as 5.8250.

On Thursday, President Recep Tayyip Erdogan said he remains opposed to the country’s tight monetary policy and pledged a “definitive solution” to soon lower the central bank’s key interest rate from 24 percent.

In other economic news, Energy Minister Fatih Donmez announced that Ankara was sending a second drilling ship to conduct natural gas operations off the northeast coast of Cyprus for three months.

Donmez said that Ankara's search for hydrocarbon reserves would continue "uninterrupted."

"We will continue the drilling activities that derive from our own legitimate rights uninterrupted," he told journalists at the port, after inspecting the ship, Yavuz.

But Greek Prime Minister Alexis Tsipras said on Friday that Turkey could face consequences from Europe if it persisted on a course of action challenging Cyprus’s right to explore for gas.

“There is an upsurge in Turkish aggression, something we don’t only observe in the relations of Turkey with Greece and Cyprus, but also important countries like the United States, and with Europe,” Tsipras told reporters at the end of an EU summit in Brussels.

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