USD/TRY: Lira sees a dead cat bounce on CBRT intervention news

• Lira resumes sell-off as European desks kick-in.
• USD/TRY: Will it regain 7.0 handle amid Turkey turmoil?

The Turkish currency, the Lira, is seen losing ground once again in early Europe, now pushing the USD/TRY pair back towards the all-time highs of 7.1326 reached in Asia opening trades.

The sell-off in the TRY extended into a fresh week after markets reacted to Turkey’s President Erdogan’s comments delivered over the weekend when he said that he opposes central bank rate hikes and any bailout from the International Monetary Fund (IMF) to avert the ongoing economic and currency crisis.

However, the Turkish currency did manage to breathe a sigh of relief on the country’s central bank (CBRT) announcements of the intervention measures.

The USD/TRY pair fell rapidly to 6.4200 level after the CBRT stepped up intervention measures by slashing the Lira required reserves by 250 bps for all the maturities.