Economics
Turkey Lifts Bank-Funding Cost as Lira Drops to All-Time Low
- Central bank tightens liquidity by cutting overnight funding
- Scenario building for an emergency rate meeting, BlueBay says
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The Turkish lira weakened to a record low and bonds tumbled, pressuring policy makers to find ways of staunching a market rout that’s putting them at odds with President Recep Tayyip Erdogan.
The currency dropped as much as 1.2 percent against the dollar before recouping some losses after the central bank pushed lenders to use a window that makes borrowing more expensive from Wednesday. The move effectively amounted to a 25 basis-point interest rate increase and came a few hours before the Treasury sold five-year bonds.