Cyprus-Forum.com

[Demonax]

If only Turkey had some of that East Med gas...

Turkey: Too Little, Too Late

ISTANBUL—The dust has settled on Turkey’s surprise decision to raise lending rates Tuesday. In a nutshell, the market’s response is: meh.

Tuesday, Turkish central bank Governor Erdem Basci hiked one of the key rates by half a percentage point, increasing the ceiling of the interest-rate corridor to 7.75%, the highest since February. It was the second rate rise in as many months, and a big deal for a central bank that earlier this year resisted tightening monetary policy. Instead, it tried to prop up its currency, the lira, with a series of dollar sales.

But the lira just kept on sliding. Wednesday, it sank by more than 1% to 1.965 per dollar and hit a new all-time low of 2.6349 against the euro. Bonds also wilted, as benchmark two-year government bond yields jumped by as much as 0.2 percentage points to 9.56%, close to a one-year high. Bond yields rise as prices drop.

The central bank responded yet again. In an e-mailed statement, Mr. Basci declared the central bank will sell a minimum of $100 million a day until further notice, and continue its additional tightening so that policymakers will lend only at the top end of its range of interest rates. The move helped the lira to recover very slightly, but still didn’t turn the tide.

“Today’s statement will likely have a limited and temporary effect on the lira and bonds,” said Ibrahim Aksoy, an economist at Seker Invest in Istanbul. “Volatility in the lira, bond market, and hence in the equity market will likely continue until the central bank of Turkey increases the upper boundary of the interest rate corridor to a level convincing market players of the health of the lira.”

Fueling Turkey’s broader selloff is widespread dissatisfaction with the central bank’s moves, which analysts say was timid at best and useless at worst (see footnote). Note that several of the central bank’s interest rates including the benchmark were left on hold; only the overnight lending rate rose, which determines borrowing costs only under certain circumstances. Mr. Basci’s efforts to calm markets come as investors are increasingly skeptical of Turkey’s ability to finance a gaping current-account deficit and stem the currency depreciation that threatens to accelerate inflation, which rose to 8.88% in July.

http://blogs.wsj.com/moneybeat/2013/08/ ... -too-late/

[Viewpoint]

The doom and gloom merchants are out in force again...sort out your own flucking economy you morons.

[Demonax]

The doom and gloom merchants are out in force again...sort out your own flucking economy you morons.

Do you think Greeks and Cypriots control the Financial Times, the Wall Street Journal, Bloomberg etc, you moron?

Who do you think writes these articles? Us?

Get a life. There is no conspiracy, Jewish or otherwise. Turkey is deep in the shit and that has consequences.

So stop sticking your head in the sand and pretending that nothing is going on.

You are the same fool who kept on telling us that Erdogan is a visionary leader. Now he is the most ridiculed politician on the planet.

Your complacency is playing into our hands. So when we speak, pay attention and learn!

[DrCyprus]

http://www.hurriyetdailynews.com/turkis ... sCatID=344

The dollar climbed to an historic high against the Turkish Lira and stocks began the day with losses, after the Federal Reserve (FED) minutes hinted that the U.S. was on course to begin tapering stimulus as early as next month.

The dollar broke two records in the morning, the second of which came as it reached 1.9875 liras.
After touching a record high point of 1.9870 liras, it had settled at around 1.980 liras, but bounced back to its second record. The rate was at 1.9730 liras yesterday, ahead of the release of the minutes.
The stock exchange, which displayed its worst performance yesterday, also opened the day with losses reaching up to 3 percent.

It fell even below 67,700 after opening, but rebounded to a level of 68,000, partially making up its losses.

The main Istanbul index 2.77 retreated down to 67,778 points at 9:50 p.m. (7.50 GMT), while Turkey’s 10-year benchmark bond yield approached 10 percent.

After closing up around 9.7 percent yesterday, the bond-yield opened at 9.94 but rebounded at around 9.90 as of 7:23 a.m. GMT.

Central Bank not holding regular auction

In response to the jitter in the markets, the Turkish Central Bank continued its toughened monetary policies and didn’t hold its regular one-week repo auctions today, stepping up to defend the lira.

The bank had said yesterday it would hold daily forex-selling auctions of a minimum $100 million every day as a further tightening step to shore up the weak lira.

Until now, the Central Bank has not sold foreign exchange on days when it implements additional tightening by not holding its regular one-week repo auctions.

The FED minutes showed members of the Federal Open Market Committee had different opinions as to when the FED should start winding down its bond purchases.

The overall view, however, was that the minutes did not materially change the market’s expectation that the FED could start tapering its monetary stimulus as early as September.

Emerging markets again bore the brunt of the selling pressure as many have come to rely on cheap dollars to underpin domestic demand and fund current account deficits.

Turkey is particularly vulnerable, being heavily dependent on foreign inflows to finance its gaping current account deficit, running at over 7 percent of national output.

[Viewpoint]

The doom and gloom merchants are out in force again...sort out your own flucking economy you morons.

Do you think Greeks and Cypriots control the Financial Times, the Wall Street Journal, Bloomberg etc, you moron?

Who do you think writes these articles? Us?

Get a life. There is no conspiracy, Jewish or otherwise. Turkey is deep in the shit and that has consequences.

So stop sticking your head in the sand and pretending that nothing is going on.

You are the same fool who kept on telling us that Erdogan is a visionary leader. Now he is the most ridiculed politician on the planet.

Your complacency is playing into our hands. So when we speak, pay attention and learn!

Your a moron we have nothing to learn from you.....what has your collapsed economy got to do with the media if you cant even work out the difference that confirms yet again you are a moron and what you have say should never be taken seriously.

[Maximus]

The doom and gloom merchants are out in force again...sort out your own flucking economy you morons.

Do you think Greeks and Cypriots control the Financial Times, the Wall Street Journal, Bloomberg etc, you moron?

Who do you think writes these articles? Us?

Get a life. There is no conspiracy, Jewish or otherwise. Turkey is deep in the shit and that has consequences.

So stop sticking your head in the sand and pretending that nothing is going on.

You are the same fool who kept on telling us that Erdogan is a visionary leader. Now he is the most ridiculed politician on the planet.

Your complacency is playing into our hands. So when we speak, pay attention and learn!

Your a moron we have nothing to learn from you.....what has your collapsed economy got to do with the media if you cant even work out the difference that confirms yet again you are a moron and what you have say should never be taken seriously.

We are just commenting on the fact and you should take this seriously VP because the reality is that the Turkish economy is heading to the dumps. If there is something you should learn from this it is that Europe at large (Greece and Cyprus) is a leading economic indicator as far as Turkey is concerned.

You have been lambasting and rejoicing in our economic misfortune and boasting and praising how Turkeys economy is so great in comparison without taking into account that Turkey is relatively speaking, a bottom feeding laggard. What happens in Turkeys economic periphery will catch up with her too.

Stick your head in the sand? Enjoy peasantsville!

[Viewpoint]

Why do you care so much about Turkey you cant even sort out your own shit.

[Maximus]

Why do you care so much about Turkey you cant even sort out your own shit.

you just wish you could silence us because your a wool brained insecure moron who cant handle it.

What has it got to do with you what we comment on here anyway? If you don't like it just click somewhere else and turn over to another thread.

[Demonax]

Your a moron we have nothing to learn from you.....what has your collapsed economy got to do with the media if you cant even work out the difference that confirms yet again you are a moron and what you have say should never be taken seriously.

Viewpoint, if you took your head out of Turkey's arse occasionally you wouldn't be so wrong all the time about everything and you wouldn't constantly be making such a fool of yourself.

Who was it that told you that Erdogan was an unhinged bigot and not, as you believed, a visionary leader? Who was it that told you that the Turkish 'economic miracle' was built on a credit bubble and would soon implode?

It pays to listen to your betters sometimes because you might learn something. Not that we're expecting any different from you. You're much too dim-witted for that.

All that you have left is to retreat further into your bunker and rant ever more loudly, shouting ever more desperately that everyone is wrong and you are right! Unfortunately, for you, everyone has you pegged.

[Demonax]

You can't argue with the markets:

Turkish Lira Slumps to Record as Stocks Tumble on Rates, Fed

The Turkish lira weakened to a record and stocks fell for a fourth day on concern the central bank isn’t doing enough to help the currency and as Federal Reserve minutes showed broad support for stimulus cuts.

The lira depreciated 0.2 percent to 1.9832 per dollar at 11:55 a.m. in Istanbul, poised for the lowest close since at least 1981. The currency has slumped 10 percent this year, the second-biggest drop among major emerging-market currencies in Europe, the Middle East and Africa after the South African rand. The Borsa Istanbul National 100 index lost 1.9 percent to 68,358.33, bringing the slide for the week to 8 percent.

The central bank raised the overnight lending rate, which comprises the upper end of its rates corridor, by 50 basis points to 7.75 percent on Aug. 20, while keeping the benchmark one-week repo rate unchanged at 4.5 percent. The prospect of reduced U.S. stimulus and Asia’s faltering growth outlook fueled a selloff of developing-nation stocks which have lost about $1 trillion this year. The MSCI Emerging Markets Index fell as much as 1.2 percent.

“The central bank’s timidity in rates is what prepared the scene for this,” Ipek Ozkardeskaya, a currency strategist at Swissquote Bank SA in Geneva, said in e-mailed comments. “It was a risk not to raise the benchmark rate when capital outflows from emerging markets were at such an accelerated pace.”

http://www.bloomberg.com/news/2013-08-2 ... s-fed.html