Overview
I'm calling 2024 the end of Lira selling.
The Details
Things to consider
I'm calling 2024 the end of Lira selling.
The Details
- 2024 could see Turkish inflation peak🗻
- The main driving force of the TRY selling has been unconventional monetary policy, erratic changes of the head of Turkey's central bank and finance ministers, and undisciplined high inflation
- A rate hiking cycle has been in play since May 2023 - rates hiking from 8.50% to 45.00% - and conventional monetary policy seems to have finally arrived😅
- Erodgan seems more committed to tackling inflation and having central bank stability
Things to consider
- I am not suggesting that Turkey is on the verge of a boom, though I am not ruling this out; inflation could be peaking, so the Lira may finally see strength. This will create an all-time high on the TRY charts.
- I suggest that the aggressive uptrend could be coming to an end, even if that means TRY pairs start ranging.
- The carry trade makes this an irresistible opportunity for me. I have been long TRYJPY since June 2023, which has resulted in generous daily swap payments💰