BREAKING: Lira slumps after massive CBRT rate cut

The Central Bank of the Republic of Turkey announced a monetary policy decision at 12:00 pm BST. While a rate cut was expected, economists were divided on scale of the cut - some expected a 100 basis point reduction while others pointed to 50 basis point reduction. Neither group was right with CBRT delivering a massive 200 basis point rate cut to 1-week repo rate. Market reaction was not surprising - Turkish lira slumped to fresh record lows against euro and the US dollar. CBRT looks to be fully supporting the unorthodox monetary policy view of the Turkish President, especially after Erdogan fired those central bankers that opposed it.

A look at EURTRY chart shows that the pair has snapped a short-term downward streak and leaped above the downward trendline. The pair moved above 11.00 for the first time in history. USDTRY moved above 9.40.

Source: xStation5