ING Revises Dollar/Lira Forecasts: 1, 3, 6 and 12-Month Projections

ING Global has updated its dollar/Turkish lira forecasts, projecting a steady depreciation of the lira over the next 12 months. The bank also expects carry traders to continue holding positions in the Turkish currency.

New Dollar/TL Forecasts

According to ING, the updated projections for the USD/TRY exchange rate are:

• 1 month: 42.00

• 3 months: 44.00

• 6 months: 46.70

• 12 months: 50.80

In its previous August estimates, ING had forecast 1-month USD/TRY at 41.70, 3 months at 43.60, 6 months at 45.90, and 12 months at 50.25.

Carry Trade Outlook

The bank noted that carry traders remain committed to the lira, attracted by Turkey’s high yields despite expectations of continued depreciation.

ING does not expect the Central Bank of Turkey (CBRT) to alter its reserve requirement framework. Instead, the bank sees monetary policy continuing in line with an inflation-driven outlook.

Policy Rate Expectations

By year-end, ING forecasts the CBRT policy rate at:

• 35.5% if the bank maintains its current pace of 250 basis-point cuts

• 36.5% if rate cuts slow to 200 basis points per meeting