The exchange rate of the USD / Trys continued its solid rally after the last federal reserve and the interest rate decisions of the Turkish Central Bank. Friday, the couple was negotiated at 39.68, a few points below the summit of 40.02 of the year. This price is around 12% above its lowest point in January.
Interest decision of the Federal Reserve
Copy the link to the section
The USD / TRY exchange rate has joined this year this year while the federal reserve made its interest rate decision. The bank left interest rates unchanged between 4.25% and 4.50% and expressed its concerns concerning the economy due to Donald Trump prices.
Officials have suggested that the bank would reduce interest rates twice this year and four times in the next two years. This decision was in accordance with expectations and was quite bellicist.
The decision also aroused criticism from Donald Trump, who asked the Fed to reduce interest rates. In a statement on Thursday, he castigated Jerome Powell, accusing him of costing hundreds of billions of dollars in interest in the United States. He stressed that Europe has undergone 10 declines of interest since last year (the number is 8).
The FED expects inflation to continue to increase this year while companies are adapting to Trump’s prices. Trump added a 10% reference rate on all imports and others on steel and aluminum.
Turkish Central Bank decision
Copy the link to the section
The USD / Trys exchange rate was also stable after the Central Bank of the Republic of Türkiye (CBRT) made its interest rate decision.
As expected widely, the bank decided to leave the interest rates unchanged at 46%, where they have been in recent months. He also left the corridor of the rates between 44.5% and 49%.
The bank left room for cuts, as recent data showed that consumer inflation has made modest improvements last month. The figures revealed that the Consumer Price Index (ICC) fell on 35.4% in May, its lowest level in four years.
The most main indicators indicate that the country’s inflation continued to decline this month. At the same time, it expects the economy to continue to manage relatively well this year. In a note, a Bloomberg analyst said:
“We have identified a dominant inclination in the interpretation by the central bank of recent data related to inflation and activity as a third and last political result of the June meeting. The decision statement has advised that the central bank will “effectively use the policy tools” – marking a change in relation to the previous language suggesting the tightening – if the inflation prospects worsen.
The main risk is that the region is faced with major geopolitical challenges which can lead to an increase in inflation as crude oil prices increase.
USD / Try a technical analysis
Copy the link to the section
The daily graph shows that the exchange rate of the USD / TRY has been in a strong rise up while the Turkish LIRA crash has continued. He formed an ascending channel and remained above the 50-day mobile average, a sign that the upward trend will continue.
The risk, however, is that the pair has formed a lower divergence model because the MacD and the relative resistance index (RSI) derived downwards.
Therefore, the pair will probably have a downward ventilation, with the following point to look at 39 years old. A movement above the resistance to 40 will invalidate the lower view.
