Commerzbank Announces Its Dollar/TRY Rate Forecast

It is the second largest bank in Germany. Commerzbankmade a remarkable statement about Turkey. Renewing their forecasts for the dollar/TL parity, bank officials announced that the Turkish lira will be worth less in March 2022 than it is now. According to the bank’s estimates In March 2022, 1 dollar will be 11 Turkish liras.. The dollar/TL estimate given by the bank in its previous statements was 10.

The reason Commerzbank updated its forecast for the Turkish lira is that the Central Bank of the Republic of Turkey (CBT) moves to lower interest rates. In the statements made by the bank, the decision of the authorities to reduce the interest rate changed the dollar/TL parity by one. spiraled intoFinally, it was stated that interest rate cuts would be stopped and even interest rates would have to be raised again.

“The rate cut is not based on economic evaluations”

The following statements were included in the report prepared by Commerzbank on the dollar Turkish lira parity:

“The interest rate cuts in an environment of high inflation caused the lira to weaken. The weakening of the Turkish lira also inflation while fueling, this also causes the spiral. Additional interest rate cuts are very likely still on the table because discounts are not based on basic economic considerations. Therefore, it would be naive to expect interest rate cuts to stop for reasons other than financial market pressures…”

Statements from the Central Bank of the Republic of Turkey (CBRT) can continue for a while makes you think. This means that we citizens face higher inflation. So why? If you’re wondering why inflation rises as interest rates are cut, here You can browse our content.