TRY, which has devaluated by 15% since April and 24% since the beginning of the year, has had a weak start to the week. USD/TRY rose by 0.6% and exceeded 17.50 yesterday. It is traded at 17.55 this morning.
The possibility of a recession in the U.S. is expected to dominate the market for a few more months, according to the France-based multinational investment bank and financial services company Societe Generale. The bank also estimates that USD/TRY will hit 22.00 at the end of this year.
Turkey’s benchmark stock index ended yesterday at 2,451.27 points, up 2.89% from last week’s close. Starting the week at 2,415.59 points, Borsa Istanbul’s BIST 100 index gained 68.83 points from the previous close. The total market value of the BIST 100 was around TRY 1.96tr by market close, with a daily trading volume of TRY 25.3bn. Analysts said 2,370 points will be the support level and 2,470 points will be the resistance level for the BIST 100 index, in technical terms.
Turkey’s energy import bill has increased as Brent crude and natural gas prices have reached USD 130 and, EUR 140, respectively, this year. Turkey’s energy imports may reach around USD 90bn in 2022, according to the investment consultancy company Oyak Yatirim. Although Turkey has no concerns over an energy supply shortage compared to Europe, it may face high levels of current account deficit due to rising prices. “Considering the fact that Turkey’s CDS exceeded 800 and the interest rate of Turkey’s borrowing in foreign exchange (FX), we think that this may create pressure on the balance of payments,” Oyak Yatirim said.
Progress has been made regarding the ‘grain corridor’ to transport grain and food products from Ukraine’s ports. National Defense Minister Hulusi Akar said there is consensus on a plan for the grain corridor and general principles. Another meeting regarding the issue is likely to be held this week. Meanwhile, President Recep Tayyip Erdogan and his Russian counterpart Vladimir Putin are expected to discuss Ukraine’s grain exports today in Tehran.
House sales increased by 11.7% to 150,509 in June, compared to the same month last year, according to the Turkish Statistical Institute (TurkStat).
Short-term external debt stock rose by 10.6% to USD 134.5bn in May, compared to the end of 2021, according to the Central Bank.
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Turkey’s current CDS premium and FX rates are higher than during the 2001 crisis, according to daily DUNYA columnist Fatih Ozatay.