Posted by meb at October 23rd, 2008

The Turkish currency lira extended its loss, falling to a two-year-low against the U.S. dollar shedding nearly 5 percent on Thursday. The lira traded above 1.72 levels in mid-afternoon trade.

The lira loss had eased slightly to 1.68 levels in morning trade on Thursday, after climbing above 1.72 late Wednesday following a Turkish Central Bank decision to hold borrowing rates steady.

The Turkish Central Bank held the benchmark overnight borrowing rate at 16.25 percent citing concerns over economic growth, however decided to cut the lending rate by 50 basis points to 19.75 percent on Wednesday.

The Turkish currency has shown a sharp decline as investors and hedge funds have been selling their assets and demanding U.S. dollar.

Turkish stocks which lost 2.64 percent at the end of the morning session, also extended their losses and fell nearly 5 percent in afternoon trade.

The yield on the benchmark June 23, 2010, rose almost 3 percent jumped close to 24.00 percent.

Global stocks also fell on fears of a recession. Asian stocks fell to a 4-year low on Thursday on growing fears that emerging market weakness would prolong a global recession and depress corporate earnings, pushing the yen to a 6-year high against the euro.
source: Hurriyet daily

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