Turkish lira rebounds from record low: State banks run to the rescue while hopes for UAE money rise

Turkey’s lira recovered as much as 7% on Wednesday from a historic slide to record lows a day earlier triggered by President Erdogan’s defence of rate cuts.  Yet, volatility and steep price rises still worry consumers and investors given policy worries.

Bloomberg reported that Turkish state-owned banks sold U.S. dollars amid heightened demand for foreign exchange on Wednesday. State banks declined to comment on interventions in the foreign-exchange market. In January last year, then central-bank governor Murat Uysal said government-owned lenders have been carrying out transactions in line with regulatory limits and may continue to be active in the currency market.

Turkey and the United Arab Emirates have signed several agreements following Crown Prince of the Emirate of Abu Dhabi Sheikh Mohammed bin Zayed bin Sultan Al Nahyan’s meeting with Turkish President Erdoğan on Wednesday.

The two leaders signed a total of 10 memoranda of understanding for cooperation in the areas of anti-terrorism, investments and development, trade and customs management, energy, and environmentalism, state-run Anadolu Agency reported.

A memorandum of understanding between the two countries’ central banks was signed by the governor of Turkey’s central bank Kavcıoğlu and the UAE Energy and Infrastructure Minister Sohail bin Mohamed Al Mazroui.

Abu Dhabi Developmental Holding Co. CEO Mohamed Hassan al Suwaidi told reporters that the UAE had set aside a $10 billion fund to invest in Turkey, according to Anadolu.

Bloomberg, Reuters, Ahval