The Euro fell again above the $ 1.14 level
After weakening to 13-month lows the euro clawed back above the $1.14 level on today, as Turkey’s lira pulled away from record lows against the dollar, but still held heavy losses for the day.
EURUSD raised up to 1.1432 by 13:30 GMT after falling as low as 1.1364 at 04:30 GMT overnight, its weakest level since early July 2017.
After briefly rising back above the 7 lira to the dollar level, USDTRY was last at 6.8921, still up 7.62% for the day. The pair hit a record high of 7.1109 overnight.
The lira pared back some of its losses after Turkey’s central bank pledged to provide liquidity and cut lira and foreign currency reserve requirements for Turkish banks.
Deteriorating relations between the U.S. and Ankara have seen the lira tumble more than 40% this year and lose a fifth of its value against the dollar in the last week alone.
The currency has also been pressured lower by worries about President Tayyip Erdogan’s increasing control over monetary policy and the economy and his opposition to higher interest rates.
Speaking in Ankara on Monday, Erdogan said that his country is under an economic “siege” and that has nothing to do with its economic indicators but predicted that Turkey would overcome the “attack” on its economy.
He insisted that Turkey’s economy remains strong and said the currency would soon settle “at the most reasonable level.”
The selloff in the lira has roiled financial markets amid fears over companies’ exposure to the Turkish currency and economy. The European Central Bank warned Friday that several euro zone banks might be exposed to the sharp decline in the lira.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, eased 0.09% to 96.10 after rising to a 13-month high of 96.39 earlier.
The safe haven yen pared gains against the dollar and the euro, with USDJPY last at 110.75 at 13:00 GMT, after falling to a one-and-a-half month low of 110.10 earlier.
EURJPY was at 126.44 at 13:00 GMT, rebounding from an intra-day low of 125.13.