Lira Weakens as Corporates Keep Buying Dollars Despite New Rule
Bloomberg. An electronic board displays exchange rates information at a currency exchange bureau in Istanbul, Turkey, on Friday, June 24, 2022. Tourism arrivals in May surged 308% year-on-year, boosting hopes that a rebound in the sector can support the weakening Lira. Photographer: Erhan Demirtas/Bloomberg
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The Turkish currency retreated on Tuesday as companies continued to buy dollars for a second day after a new rule imposed restrictions on extending lira loans to foreign-exchange-rich corporates.
The lira fell as much as 0.5% to 16.6376 per dollar after rising more than 2% on Monday. Corporates purchased dollars even as state lenders moved to defend the local currency, according to three traders who asked not to be identified because theyre not authorized to speak publicly.
State lenders sold more than $1 billion in two days to support the currency, they said. One trader said the net impact was limited as some firms dollar sales were offset by others.
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