USD/TRY cautious, sidelined below 7.00

• TRY remains under pressure around the 6.90 area.
• Spot retreats from recent all-time highs beyond the 7.0 mark.
• Attention remains on the CBR and potential measures.

The Turkish Lira keeps depreciating vs. its American peer at the beginning of the week and is now prompting USD/TRY to attempt a sideline theme in sub-6.90 levels.

USD/TRY still under pressure, looks to CBR

The Turkish Lira remains fragile, although it somehow managed to trim some losses after hitting fresh all-time lows vs. the greenback beyond 7.00 the figure during early trade.

TRY regained some buying interest after the Turkish central bank (CBRT) announced it will not fund on Monday at 17.75% amidst heightened volatility and ‘unhealthy price formations’.

Furthermore, the CBRT said it will meet banks’ liquidity needs at 19.25%. TRY gained some ground in the wake of these announcements, as market participants see the central bank moving closer to tightening its monetary conditions further.

USD/TRY key levels

At the moment the pair is gaining 7.89% at 6.9083 facing the next hurdle at 7.1326 (all time high Aug.10) and then 8.0000 (psychological level). On the downside, a breach of 5.4786 (10-day SMA) would open the door to 5.1348 (21-day SMA) and finally 4.7305 (low Jul.23)