American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Investing

USD/TRY: Turkish lira forecast after key Morgan Stanley warning

by admin July 26, 2025
July 26, 2025
USD/TRY: Turkish lira forecast after key Morgan Stanley warning

The USD/TRY exchange rate surged to a record high this week after the Central Bank of the Republic of Turkey (CBRT) slashed interest rates by 300 basis points. It jumped to 41.05, continuing a trend that has been going on for years.

The CBRT slashed interest rates after recent economic numbers showed that the headline inflation was in a downward trend. A report by the statistics agency showed that the headline CPI dropped from 35.41% in May to 35.05% in June.

The June inflation report was lower than the median estimate of 35.20%. It was the fifth consecutive month that the country’s inflation missed analysts’ estimates. 

The falling inflation rate, although higher than in most countries, has boosted the central bank’s confidence to slash rates, a move that will likely cheer President Erdogan. It brought the headline rate to 43% and the borrowing and lending rates to 41.5% and 46%, respectively. 

The new interest rate cut has a major implication in the forex market as the USD/TRY is one of the most crowded carry trade globally. A carry trade is a situation where investors borrow a low-interest-rate currency like the US dollar or euro and then invest in a high-yielding ones. 

The carry trade has been effective because the Turkish lira has remained fairly stable over the past few months. Now, however, Morgan Stanley believes that the situation may start to change as the spread between the US and Turkish interest rates narrows. 

The bank’s analysts also warned that the trade was so crowded because of the sizable returns. Even after the CBRT rate cut, the spread between Turkey’s 43% and US 4.5% interest rates make it highly profitable. 

However, its crowded nature as the spread narrows means that it could become highly volatile if many investors start to unwind their positions as we experienced with the Japanese yen last year when the Bank of Japan started hiking interest rates.

The next key catalyst for the USD/TRY exchange rate is the upcoming credit rating updates by Moody’s and Fitch. These companies are likely to drive economic growth and lower inflation. 

USD/TRY technical analysis

USDTRY chart by TradingView

The daily chart shows that the USD to TRY exchange rate has been in a bullish trend for years. Most recently, it has formed a narrow ascending channel.

The MAC indicator has remained above the zero line, while the Relative Strength Index (RSI) has moved to the overbought point of 70. Therefore, the pair will likely continue rising as bulls target the next key resistance level at 42. 

Read more: USD/TRY forecast: Will the Turkish lira hit 40 in 2025?

The post USD/TRY: Turkish lira forecast after key Morgan Stanley warning appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
As the Oracle stock price surges, will Larry Ellison flip Elon Musk?
next post
Standard Chartered share price forms giant C&H ahead of earnings

Related Posts

​Tech 5: Recession Fears Kick Panic Selling into...

August 10, 2024

Best crypto coins to stake for 12%+ returns...

November 29, 2024

SLV ETF inflows surge as silver price rally...

June 8, 2025

Funds Received from Partial Sale of Codrus Shares

April 17, 2024

Here’s why Bitcoin, Solana, Popcat, and Mantra prices...

November 5, 2024

ASX 200 index forecast as odds of dovish...

January 29, 2025

CAC 40 Index forecast ahead of Kering, Airbus,...

July 28, 2025

DXY index: US dollar forms bullish pennant ahead...

October 31, 2024

NextSource Materials

May 30, 2024

Uranium and Gold Explorer Piche to Commence Trading...

July 17, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • Europe bulletin: Manchester synagogue attack aftermath, stocks close higher

      October 5, 2025
    • Evening digest: Trump sets deadline for Hamas, Canada’s slowdown, BTC rebounds

      October 5, 2025
    • Iran executes six people for alleged links to Israel, state media reports

      October 5, 2025
    • US digest: Trump’s Hamas ultimatum, government shutdown stalemate continues

      October 5, 2025
    • Japanese stocks may extend record run as Takaichi win revives ‘Abenomics’

      October 5, 2025

    Categories

    • Business (4,191)
    • Investing (2,958)
    • Latest News (2,080)
    • Politics (1,536)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved