Turkey’s nationwide local elections affect Lira

Daily Analysis - 29/03/2019

Investor fears have sent Turkey's lira lower

Next Sunday Turkey's citizens will be headed to the polls due to new, public concerns regarding their currency.

Investors have a lot to lose in the country.

Exchanges are still trying to recover from Turkey's currency crash last summer, which sparked a sell-off in developing markets and sent traders running for cover. On Thursday the lira dropped as much as 5% versus the greenback on news that the Turkish Central Bank had consumed through almost a 1/3 of its foreign assets in the first three weeks of March as it attempted to boost the currency and choke short-sellers ahead of the vote.

Brent crude oil gained 30 cents

On Friday Oil climbed, boosted up by continuous supply cuts directed by OPEC and U.S. penalties upon Iran and Venezuela. This set the crude markets on the move to register their largest first-quarter increase since 2009. WTI futures are set to increase for a straight month and are set for a first-quarter profit of more than 30%. U.S. West Texas Intermediate (WTI) futures went to $59.56 per barrel about 0.4% up from their last close.

Greenback retraces

On Friday the greenback is set for its biggest increase in five months while traders reacted positively to a retracement in U.S. Treasury yields. Another factor that boosted the popular currency is because some of its competitors were beaten by dovish signs from their own central banks.

With many currencies on defensive mode, the dollar has overcome a drop in benchmark Treasury yields. Facing a basket of important competitive currencies, the U.S. currency was higher at 97.216.

Gold is declining fast

On Friday the popular yellow metal Gold slid and marked a way towards for its poorest month since August last year. This happened while the dollar and equities increased.

Spot gold fell about 0.1% to $1,288.72 per ounce following a decline of around 1.5% in the previous session.

The Gold is set for its first weekly decline in four and has wasted about 1.8% in the past 30-days.

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