ForexEzy
No Result
View All Result
  • Top Forex Advisors
    • Best Forex Robots
    • Best Forex Signals
    • Best Managed Accounts
  • Top Forex Brokers
    • Best Forex Brokers
    • US Forex Brokers
    • UK Forex Brokers
    • MT4 Forex Brokers
    • MT5 Forex Brokers
    • Zero Spread Brokers
    • Best PayPal Brokers
    • TradingView Brokers
    • Social Trading Platforms
  • Top Review Platforms
  • Forex Education
    • Getting Started
    • Forex Basics
    • Forex Trading Strategies
    • Money Management
    • Risk Management
    • Technical Analysis
    • Fundamental Analysis
    • Trading Psychology
    • Social Trading
    • Automated Trading
  • Forex Tools
    • Forex Robots
    • Forex Indicators
    • Forex Signals
    • Forex VPS
  • Forex Forecast
  • Crypto
    • Best Crypto Exchanges
    • Best Crypto Bots
    • Crypto Guides & Forecasts
  • Top Forex Advisors
    • Best Forex Robots
    • Best Forex Signals
    • Best Managed Accounts
  • Top Forex Brokers
    • Best Forex Brokers
    • US Forex Brokers
    • UK Forex Brokers
    • MT4 Forex Brokers
    • MT5 Forex Brokers
    • Zero Spread Brokers
    • Best PayPal Brokers
    • TradingView Brokers
    • Social Trading Platforms
  • Top Review Platforms
  • Forex Education
    • Getting Started
    • Forex Basics
    • Forex Trading Strategies
    • Money Management
    • Risk Management
    • Technical Analysis
    • Fundamental Analysis
    • Trading Psychology
    • Social Trading
    • Automated Trading
  • Forex Tools
    • Forex Robots
    • Forex Indicators
    • Forex Signals
    • Forex VPS
  • Forex Forecast
  • Crypto
    • Best Crypto Exchanges
    • Best Crypto Bots
    • Crypto Guides & Forecasts
No Result
View All Result
ForexEzy
No Result
View All Result
The World’s Leading Social Trading Platform
Try now
Home Forex Market Commentary

USDTRY Price Forecast: More Gains as Fed and CBRT Divergence Expected

by Adam Stanley
December 31, 2021
in Forex Market Commentary
0
USDTRY Price Forecast: More Gains as Fed and CBRT Divergence Expected
0
SHARES
11
VIEWS
Share on FacebookShare on Twitter

The USDTRY had a great year as the Turkish lira collapse accelerated. The pair started the year at around 7 and soared to an all-time high of 18.38. On Friday, it was trading at 13.25, which was about 28% above the lowest level last week.

The Best Forex Robots Report Is Already Here!
best forex robots
Check out 30+ best expert advisors with daily updated live results and statistics
Click Here

CBRT and the Turkish central bank

The Central Bank of the Republic of Turkey (CBRT) embraced an unconventional monetary policy framework in 2021. 

In the final half of the year, as inflation skyrocketed, the central bank decided to implement three rate cuts. The headline interest rates dropped by 600 basis points from 20% to 14%. 

The interest rate cuts were controversial because of the state of the Turkish economy. The official inflation rate surged to above 20%. Unofficial figures placed the country’s inflation at about 58%.

The modern monetary theory argues that a central bank should do whatever it can to balance the overall inflation rate. As such, it argues that a bank should hike interest rates and tighten monetary conditions when inflation is rising.

The CBRT was an outlier in cutting rates. Across the world, we saw more central banks embracing a hawkish tone. In emerging markets like South Africa, Mexico, and Russia, the central banks delivered multiple hikes in 2021.

Similarly, in the developed world, central banks like the Bank of England (BOE), Reserve Bank of New Zealand (RBNZ), and the Bank of Canada (BOC) all hiked rates. Other banks like the Federal Reserve have also hinted that they will hike rates.

CBRT backdoor rate hike

The USDTRY pair declined sharply recently after the Turkish government and the CBRT made new plans to cushion the drop of the Turkish lira.

In another controversial decision, the bank promised its citizens that it will compensate them for the weakness of the Turkish lira. This incentive program will only apply to individuals, meaning that more businesses will keep struggling.

It will only apply to individuals who have saved money for about 3 months. The idea is relatively simple. For example, if a person has 10,000 Turkish liras and the value drops by 10% against the US dollar, then the government will add 1,000 liras to their account. That was a controversial move because it is an effective backdoor rate hike.

Fed hikes and Turkish elections

In 2022, the USDTRY pair will react to the actions of the Federal Reserve and the Turkish election. The Fed has hinted that it will implement three rate hikes in 2022. In theory, these hikes should be bad for the Turkish lira because it means that the government will need to pay more in terms of interest. 

Another thing that could drag the Turkish lira lower will be the upcoming general election. President Erdogan will face a united opposition, which could see him implement more expansionary policies. In most cases, the Turkish lira tends to decline when there is an election.

USDTRY forecast

The USDTRY pair is trading at 13.28, which is slightly above last week’s low of 10.30. The pair has rebounded as investors assess the new backdoor rate hikes. It has crossed the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has tilted higher. Other oscillators like the MACD and the Stochastic Oscillator have also pointed upwards.

Therefore, the USDTRY pair will likely keep rising in the coming months as investors target the 2021 high of 18.33. As long as the divergence between the CBRT and the Fed exists, there is a likelihood that the pair will keep rising.

The daily USD TRY price chart
The Best Forex Robots Report Is Already Here!
best forex robots
Check out 30+ best expert advisors with daily updated live results and statistics
Click Here
ShareTweet
Previous Post

Excelsior Review

Next Post

GBPUSD Price Forecast: Further Upside Can’t Be Ruled Out

Related Posts

Gold Price Forecast: Here Are the Catalysts to Watch

Gold Price Forecast: Here Are the Catalysts to Watch

by Tim Baudin
May 31, 2022
0

Gold price will likely remain range-bound until a catalyst arises in the form of the scheduled economic data.Investors await the...

Bitcoin Price Prediction After the Hawkish Fed Decision

Bitcoin Price Prediction After the Hawkish Fed Decision

by Chintan Patel
January 27, 2022
0

The Bitcoin (BTCUSD) price erased some of the gains made earlier this week as the market reacted to the latest...

USDJPY Range Bound Below 114.00 as NZDUSD Sell-off Persists Below 0.6700

USDJPY Range Bound Below 114.00 as NZDUSD Sell-off Persists Below 0.6700

by Adam Stanley
January 25, 2022
0

US dollar strengthens to two-week highs.USDJPY bounces off one-month lows.NZDUSD sell-off persists. The US dollar bounced back to two-week highs...

USDJPY Forecast as BoJ Retains Interest Rates

USDJPY Forecast as BoJ Retains Interest Rates

by Tim Baudin
January 18, 2022
0

Bank of Japan retains interest rates at -0.1%.US Treasury yields are still rising, thus helping cushion the dollar.Rising oil prices...

Market Analysis: AUDUSD Breakout Looms and USDJPY Tanks on Dollar Weakness as Oil Prices Rally on Supply Concerns

Market Analysis: AUDUSD Breakout Looms and USDJPY Tanks on Dollar Weakness as Oil Prices Rally on Supply Concerns

by Chintan Patel
January 17, 2022
0

US Dollar under pressure after a pullback.AUDUSD breakout looms on dollar weakness.USDJPY bounce back stalls.Oil prices rally on supply concerns.Cryptocurrencies...

Load More

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Best Forex Automated Systems

  • TechBerry 9/10
  • Happy Galaxy 8.5/10
  • Forex Cyborg 8.5/10
  • Forex Fury 8/10
  • FXgoodway 7.5/10
  • Best Forex Brokers
  • Best Forex Robots
  • Best Forex Signals
  • Best Forex Managed Accounts

Top Trading Markets

We are dedicated to demystify the world of forex trading for you – no matter what level you are on.

Categories
  • Automated Trading
  • Crypto Robot Review
  • Cryptocurrency Trading
  • Day Trading
  • Forex Basics
  • Forex Brokers
  • Forex Education
  • Forex Forecasts
  • Forex Indicators
  • Forex Market Commentary
  • Forex Robots
  • Forex Signals
  • Forex Signals
  • Forex Tools
  • Forex Trading Strategies
  • Forex VPS
  • Fundamental Analysis
  • Managed Accounts
  • Money Management
  • News
  • Review
  • Review Platforms
  • Risk Management
  • Social Trading
  • Technical Analysis
  • Top World Traders
  • Trading Apps
  • Trading Psychology
  • Uncategorized
Tags
Acquisition AI Amazon Apple Artificial Intelligence Bitcoin bond yields CEO China earnings earnings report economy Electric Vehicles Federal Reserve financial performance Financial Results forex ea forex software reviews Growth Guidance Housing Market inflation interest rates Investing investment Investors Market Volatility merger mortgage rates net profit Nvidia Oil prices Q2 Results revenue Revenue Growth Sales sales growth Stock Futures stock market stock performance Stocks strategies technology Tesla Video
  • Terms of Use
  • Privacy Policy
  • Compensation Disclosure
  • Risk Disclosure
  • About Us
  • Contact Us

Copyright © 2023 by ForexEzy.com

No Result
View All Result
  • Top Forex Advisors
    • Best Forex Robots
    • Best Forex Signals
    • Best Managed Accounts
  • Top Forex Brokers
    • Best Forex Brokers
    • US Forex Brokers
    • UK Forex Brokers
    • MT4 Forex Brokers
    • MT5 Forex Brokers
    • Zero Spread Brokers
    • Best PayPal Brokers
    • TradingView Brokers
    • Social Trading Platforms
  • Top Review Platforms
  • Forex Education
    • Getting Started
    • Forex Basics
    • Forex Trading Strategies
    • Money Management
    • Risk Management
    • Technical Analysis
    • Fundamental Analysis
    • Trading Psychology
    • Social Trading
    • Automated Trading
  • Forex Tools
    • Forex Robots
    • Forex Indicators
    • Forex Signals
    • Forex VPS
  • Forex Forecast
  • Crypto
    • Best Crypto Exchanges
    • Best Crypto Bots
    • Crypto Guides & Forecasts

© 2023, Forexezy. {copy} {year}