The pessimism over a deteriorating Turkish economy

It looks like the lira will continue its weakness due to the surprising decision from Turkey’s central bank made on Friday. Investors have been disappointed over expectations that it would raise its interest rate – now that it kept the rate as it is, investors will keep pushing the dollar up. Geopolitics, as well as the possibility of another coronavirus wave, will also stir pessimism over a deteriorating Turkish economy for a longer time than its government forecasted earlier this year. The pair’s 50-day moving average has been surging above its 200-day moving average, and it will continue to do so until the Turkish economy begins to show workable progress towards its economy. That probability is getting thinner and thinner by the day. Even then, the US stimulus packages are unlikely to pull the greenback down against the lira, even as its value decreases over what could be a 2 trillion US dollar package for suffering businesses and states.