Analysts: Turkish lira to further weaken

Turkish financial markets have started to recoup some of their losses following the failed military coup attempt earlier this month, but analysts of the British consulting company Capital Economics think that the the country’s national currency lira in particular is more likely to fall than rise from here on.

“We think that the markets may be underestimating the ramifications of the recent events,” analysts said in a report, obtained by Trend.

“As the consequences of the failed coup become clearer, the markets may fall further, particularly as interest rate hikes in the US come back onto the agenda making the external environment less favourable.”

Analysts expect the lira to weaken to 3.10/$ by the end of the year and further to 3.50/$ by end-2017, from 3.04/$ currently.

On July 15 evening, Turkish authorities said a military coup attempt took place in the country. Meanwhile, a group of servicemen announced about transition of power to them.

However, the rebelling servicemen started to surrender July 16 and Turkish authorities said the coup attempt failed. Turkey’s President Recep Tayyip Erdogan said that the death toll as a result of the military coup attempt stood at 246 people excluding the coup plotters and over 2,000 people were wounded.

Erdogan declared a three-month state of emergency in Turkey on July 20.

Source: Trend News Agency