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Turkish Lira Falls to Record Low Near 19 to the Dollar

Woman holds Turkish Lira banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/Illustration
Woman holds Turkish Lira banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/Illustration
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Turkish Lira Falls to Record Low Near 19 to the Dollar

Woman holds Turkish Lira banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/Illustration
Woman holds Turkish Lira banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/Illustration

Türkiye's lira weakened to a fresh record low of 18.9620 against the dollar on Thursday.

Presidential and parliamentary elections scheduled for May 14 are adding to uncertainty. They will determine whether Türkiye continues with unorthodox policies under President Tayyip Erdogan or reverts to orthodoxy as promised by the opposition.

Separately, Türkiye's Treasury said on Thursday it had borrowed $2.25 billion in a eurobond issue maturing in 2029, bringing the amount it borrowed from international markets to $5 billion this year.

The yield to investor in the latest issue was 9.50%, down from 9.75% in the eurobond issued in January, the Treasury said, adding that demand was more than triple the amount issued, Reuters reported.

More than a third of the amount issued was sold to investors in the United Kingdom and more than 20% to those in the United States, it said.

The lira lost some 30% of its value against the dollar in 2022 and 44% the year before.

It is likely to hover around 19 to the dollar until the end of the election cycle, largely thanks to forex interventions, but would likely decline further in the long term if Erdogan wins the election, Wells Fargo said in a note.

Türkiye's international bonds also came under pressure with longer-dated issues falling around half a cent in the dollar, according to Tradeweb. ,

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US Applications for Jobless Claims Fall to 201,000, Lowest Level in Nearly a Year

A help wanted sign is displayed at a restaurant in Chicago, Ill., Nov. 25, 2024. (AP Photo/Nam Y. Huh, File)
A help wanted sign is displayed at a restaurant in Chicago, Ill., Nov. 25, 2024. (AP Photo/Nam Y. Huh, File)
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US Applications for Jobless Claims Fall to 201,000, Lowest Level in Nearly a Year

A help wanted sign is displayed at a restaurant in Chicago, Ill., Nov. 25, 2024. (AP Photo/Nam Y. Huh, File)
A help wanted sign is displayed at a restaurant in Chicago, Ill., Nov. 25, 2024. (AP Photo/Nam Y. Huh, File)

US applications for unemployment benefits fell to their lowest level in nearly a year last week, pointing to a still healthy labor market with historically low layoffs.

The Labor Department on Wednesday said that applications for jobless benefits fell to 201,000 for the week ending January 4, down from the previous week's 211,000. This week's figure is the lowest since February of last year.

The four-week average of claims, which evens out the week-to-week ups and downs, fell by 10,250 to 213,000.

The overall numbers receiving unemployment benefits for the week of December 28 rose to 1.87 million, an increase of 33,000 from the previous week, according to The AP.

The US job market has cooled from the red-hot stretch of 2021-2023 when the economy was rebounding from COVID-19 lockdowns.

Through November, employers added an average of 180,000 jobs a month in 2024, down from 251,000 in 2023, 377,000 in 2022 and a record 604,000 in 2021. Still, even the diminished job creation is solid and a sign of resilience in the face of high interest rates.

When the Labor Department releases hiring numbers for December on Friday, they’re expected to show that employers added 160,000 jobs last month.

On Tuesday, the government reported that US job openings rose unexpectedly in November, showing companies are still looking for workers even as the labor market has loosened. Openings rose to 8.1 million in November, the most since February and up from 7.8 million in October,

The weekly jobless claims numbers are a proxy for layoffs, and those have remained below pre-pandemic levels. The unemployment rate is at a modest 4.2%, though that is up from a half century low 3.4% reached in 2023.

To fight inflation that hit four-decade highs two and a half years ago, the Federal Reserve raised its benchmark interest rates 11 times in 2022 and 2023. Inflation came down — from 9.1% in mid-2022 to 2.7% in November, allowing the Fed to start cutting rates. But progress on inflation has stalled in recent months, and year-over-year consumer price increases are stuck above the Fed’s 2% target.

In December, the Fed cut its benchmark interest rate for the third time in 2024, but the central bank’s policymakers signaled that they’re likely to be more cautious about future rate cuts. They projected just two in 2025, down from the four they had envisioned in September.