EURTRY surges on Erdogan comments

The Turkish lira surges last Thursday after the CRBT announced a larger than expected interest rate hike but new doubts have send it lower on Monday. USDTRY gains 2% and EURTRY 2.6% on Monday after revelations that Erdogan seeks a nationalization of a 28% stake in the largest listed domestic bank (Isbank) that is currently owned by an opposition party. The move would be seen as another sign of unpredictability just in time when the lira needs a period of calm. A rise in EURTRY and USDTRY defies a general market sentiment where the dollar pulls back, especially against the SEK (-1.2%). The key level to watch on USDTRY is 6.35.