Turkey Tells Banks to Slow FX Buying

Turkey told banks to wait one day before settling some large foreign-currency purchases, the latest move to defend the lira as President Recep Tayyip Erdogan’s party seeks to keep control of Istanbul in a controversial rerun of local elections.

The bank regulator told lenders to settle all retail transactions valued at $100,000 or higher one working day later, instead of the current practice of doing it on the same day, according to a document sent to banks on Monday, which was seen by Bloomberg and verified by three bankers. The regulator didn’t immediately have a comment on the move.

The lira didn’t immediately react after posting gains earlier on Monday. The currency was down 0.2% against the dollar at 6.0380 as of 9:05am on Tuesday.

Turkish authorities have become more interventionist in the markets, drawing criticism from investors, after a series of crises turned the lira into one of the world’s weakest currencies.

Bad Company

On emerging markets, only Argentina’s peso has lost more value than Turkey’s lira in the past 12 months.

Bloomberg

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell