ONLINE FOREX BROKER
2019-11-11 • Updated
The lira strengthened significantly following President Erdogan referendum victory held on April 16. Yet it was hardly the win the president had expected. The yes camp limped away with just 51.4% of the vote. The opposition and outside observers accused the country’s electoral board with stacking the odds in Mr. Erodgan’s favor. Investors seemed to be less concerned with the fairness of referendum’s results; they welcomed outcome although there are still many questions of how Erdogan will use his enhanced powers to reunite splintered nation, revive economic growth, bring inflation under control, strengthen lira, resolve problems with country’s external woes and widened the current-account deficit.
On this Monday, with the first round of France’s presidential election complete, many emerging market currencies managed to escape a potential sell-off trigger that they would have experienced if centrist Macron hadn’t won the runoff. So, the Turkish lira extended its post-referendum gains since the French results announcement. USD/TRY slumped to 3.5675. In the following day, the Turkish currency lost its steam despite the great efforts of the Turkish Central Bank to strengthen its exchange rate and fight inflation. Earlier today Turkish central bank officials unexpectedly increased its late liquidity window rate by 50 bp to 12.25% despite pressure from Erodgan’s government to avoid tightening measure. The bank officials seem to be deaf to government’s threats; they are determined to tackle the country’s inflation problem with additional tightening measure if needed. The lira strengthened after the decision and started trading at 3.5720 against the US dollar. The lira’s rally has little support though as Donald Trump is preparing to reveal his tax plan later today.
The technical outlook for USD/TRY is bullish. The prices failed to break a solid support line at 3.5483 which is the basis of the descending triangle – a bearish chart pattern. Now, the quotes are heading towards the salient resistance at 3.6521, near the coming closer together of 50- and 100-day MAs. A break of this resistance will open the way towards next hurdle at 3.7475 (April 7 high). If markets are disappointed with Trump not providing sufficient details on his tax plan, USD/TRY might try test the support at 3.5483, or lower levels.
Oil prices rebounded slightly on Friday but are still expected to show losses for the week due to concerns about slowing growth in the US and China. US crude futures rose 2.7% to $70.41 per barrel, while the Brent contract increased by 2.5% to $74.33 per barrel.
China's economy is rocketing. On the other hand OPEC+ countries take the decision to cut the production. What will be the impact on the oil price?
The past two years have seen the biggest swings in oil prices in 14 years, which have baffled markets, investors, and traders due to geopolitical tensions and the shift towards clean energy.
Let's dive into the latest developments shaping the global economic landscape. Good news first: the threat of an unprecedented US debt crisis has receded, as US lawmakers passed a bill to raise the debt ceiling and avoid a catastrophic default. Phew! But don't pop the champagne just yet, because storm clouds are still looming. High inflation, rising interest rates, and sluggish growth are challenges that have yet to disappear.
Thanks to the incredible advancements in horizontal drilling and fracking technology, the United States has experienced a mind-blowing shale revolution. They've become the heavyweight champion of crude oil production, leaving Saudi Arabia and Russia in the dust. They even turned the tables and became net exporters of refined petroleum products in 2011.
Let's dive into the world of gold. Currently, the price of gold, represented by XAUUSD, is stuck in indecision, hovering around the $1,975 mark. The market is anxiously awaiting two important factors: the release of the Federal Reserve's meeting minutes and the extension of the US debt ceiling.
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