Thursday ended with the EUR/USD being high above of local resistance of 1.10. What's the target now?
Great volatility in TRY
Turkish lira (TRY) is continuing to provide traders with exciting opportunities. USD/TRY jumped to a record high above 6.00 on Friday. Turkish currency lost 14%.
The currency is so volatile because investors are worried ahead of a much-anticipated public address by the Turkish President Recep Tayyip Erdogan. Traders panicked as Mr. Erdogan has a big influence on Turkish monetary policy. Erdogan is an adversary of high interest rates, so his interference in the currency market can be negative for the TRY.
In addition, the relations between Turkey and the United States worsened after the detention of an American pastor. There are risks that Turkey may fall under further sanctions if he isn’t released.
Market concerns are bad for Turkey which is dependent on foreign capital. Traders are now waiting for the reaction of Turkish monetary authorities to stabilize the situation.
The European Central Bank expressed concerns that the turmoil in Turkish assets may have a negative impact on euro zone banks.
Erdogan will speak at 11:00 GMT on August 10. Earlier today, he said that Western credit ratings agencies are trying to undermine Turkish economy. “If they have their dollars, we have our people, our God,” claimed Erdogan.
The European central bank will publish the main refinancing rate and make a statement on Thursday, July 16, at 14:45 MT time. Also, the ECB’s press conference will be later at 15:30 MT time.
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The Canadian central bank will announce interest rates and make a speech on Wednesday, July 15, at 17:00 MT time. Also, the BOC press conference will be later at 18:15 MT time.