What matters this morning

Floods in the Black Sea region this week have killed at least 17 people with at least one missing, according to President Recep Tayyip Erdogan. Interior Minister Suleyman Soylu said 15 people lost their lives in Kastamonu and 2 people died in Sinop. So far 850 people were rescued in collaboration with Turkish Air Forces, gendarmerie, police forces, AKUT Search and Rescue Association, coast guard and NGOs. Several bridges in these cities have been damaged or have collapsed due to the floods and 274 villages have been left without electricity.

On the economy side, the Central Bank kept the interest rate steady at 19% as expected. The bank repeated its emphasize on keeping the policy rate above the inflation while it pointed out that global and national inflation risks based on food prices increase. The PPK statement was generally remained unchanged and no new messages about the interest rate cut was included in it. This was responded positively by the market. Opinions that the policy rate will be lowered in Q4 have strengthened, according to analysts.

USD/TRY, which stood at 8.60 prior to the Central Bank’s interest rate decision, dropped below 8.52 after the Bank kept interest rate unchanged and before it increased to 8.57. Today, USD/TRY stands at 8.56, while EUR/TRY is traded at 10.05.

Although gold prices slightly increased following concerns over the fast spread of delta variant, the increase was limited. Spot gold is traded at USD 1,759 per ounce. Oil prices started to decrease after the International Energy Agency (IEA) warned about the sharp decline in crude oil and its derivatives as the governments started to take travel measures following increasing in COVID-19 cases. Brent crude hovers around USD 70-71 per barrel. 


House sales dropped by 53% to 107,785 in June, compared to the same month of the previous year, according to the Turkish Statistical Institute (TurkStat).

The Central Bank will release balance of payment statistics for May. The current account balance is expected to post USD 1.1bn deficit.

The international credit rating agency Fitch Ratings will announce Turkey’s outlook (11.00-.11.30 pm). The institution has previously revised the country’s Long-Term Foreign Currency Issuer Default Rating (IDR) to Stable from Negative and affirmed it at ‘BB-’.

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