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The Turkish Lira Is Updating The Historical Minimum

The Turkish Lira Is Updating The Historical Minimum

The Turkish Lira exchange rate falls on Monday against the dollar and updates the historical minimum amid geopolitical concerns, according to trading data.

As of 12.18 GMT, the dollar exchange rate rose to 7.778 Lira per dollar from 7.6607 Lira at the previous close. Earlier in the course of trading, quotes jumped to 1.7871 Lira.

Thus, the exchange rate of the Lira to the dollar is at a new historical low. In early August, it updated the historical low reached in May 2020 at 7.2712 Lira to the dollar. Since then, the Turkish currency has mostly weakened, with the pace accelerating since mid-September.

Another geopolitical risk has been added to the aggravation of Turkey's relations with Greece over the borders of their shelf in the Eastern Mediterranean over the weekend. Turkish President Tayyip Erdogan called his Azerbaijani counterpart Ilham Aliyev and expressed Ankara's full support for the situation on the contact line in Karabakh.

On September 27, the Azerbaijani Defense Ministry said that the Armenian armed forces fired at settlements on the contact line in Karabakh, according to these data, there were civilian and military deaths. According to the Armenian Defense Ministry, Karabakh "was subjected to air and missile attacks." Yerevan stated that Baku "launched an offensive" in the Karabakh direction. The unrecognized Nagorno-Karabakh Republic reported that peaceful settlements in Karabakh, including the capital Stepanakert, were shelled, the authorities called on the population to take shelter and later declared martial law and mobilization. Armenia also declared martial law and General mobilization. Baku stated that there is no need to mobilize, the army is fully equipped. The President of Azerbaijan approved the introduction of martial law in several cities and regions of the Republic and a curfew in the country. A number of States, including Russia and France, called on the parties to exercise restraint.

"There are concerns that Turkey will be drawn into another regional conflict," Timothy Ash, an analyst at BlueBay Asset Management, told Reuters.

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