The Turkish lira keeps losing ground on Wednesday and is lifting USD/TRY to a new all-time high above the 7.50 level.
The lira keeps depreciating vs. the greenback amidst the increasing negative sentiment around the Turkish currency, particularly after credit rating agency Moody’s downgraded Turkey’s debt rating to junk on Tuesday (same category as Tanzania, Rwanda and Jamaica). The agency justified its move in the marginal levels of FX reserves and the government policies.
Moody’s also kept the negative outlook on the currency and warned of a potential crisis in the country’s balance of payments in the coming years, which should eventually morph into extra downside pressure on the currency.
So far this year, TRY shed nearly 21% vs. the US dollar.
At the moment the pair is gaining 0.23% at 7.5024 and faces the next hurdle at 7.5059 (all-time high Sep.16). On the downside, immediate support is located at 7.3978 (21-day SMA) followed by 7.2019 (low Aug.21) and finally 7.1478 (55-day SMA).