US Close: Stocks slump on surging crude and growth concerns, Lira plunges

Thin trading during a Columbus Day holiday shows stocks are struggling as investors start to grow nervous knowing markets won’t see any quick fixes over the brewing energy crisis and inflationary pressures.  The growth outlook for the US has more risks than it did a month ago, but that shouldn’t prevent long-term bets on US stocks.  Goldman slashed their outlook for 2022 from 4.4% to 4.0% on consumer spending worries.

Congress is in recess and expectations are weakening that infrastructure investments will pass.  Congress could run out of legislative days to get this done and that will eventually weigh on the short-term outlook. The treasury market was closed today but that did not slow global bond yields from rising. The rest of the year will be all about inflation and the nagging supply chain issues that seem poised to last for at least a couple more quarters.


The FX world continues to watch in awe as President Tayyip Erdogan continues to influence which policies the Turkish central bank (CBRT) should adopt.  The Turkish lira fell to a fresh record low, as the CBRT continues to ignore inflationary pressures and listens to President Erdogan in providing more support to the economy.  The lira fell beyond 9.00 against the dollar, a move that probably will last longer as Erdogan may push for more monetary stimulus.  Inflationary pressures will not ease anytime soon and if further rate cuts happen, the lira could easily fall to the 10 handle. 

Political interference is widely known to happen in Turkey, but it seems this central bank governor is following orders and that could suggest more rate cuts will happen over the next couple of quarters.

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Ed Moya

Ed Moya

Contributing Author at OANDA
With more than 20 years’ trading experience, Ed Moya was a Senior Market Analyst with OANDA for the Americas from November 2018 to November 2023. His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies. Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Prior to OANDA he worked with, where he provided market analysis on economic data and corporate news. Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business, cheddar news, and CoinDesk TV. His views are trusted by the world’s most respected global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Seeking Alpha, The New York Times and The Wall Street Journal. Ed holds a BA in Economics from Rutgers University.