Turkish Lira Rises on Rate Hike
Prabha Natarajan; The Wall Street Journal; Jan. 28th, 2014
Turkey’s currency surged after the country’s central bank aggressively hiked key interest rates, a move that revived confidence in other battered emerging-market assets.
Within minutes of the announcement, the Turkish lira strengthened 3% against the dollar—a big move in foreign-exchange markets. That brings gains in the lira to almost 10% since the currency hit a record low Monday. In recent trade in New York, one dollar bought 2.1867 lira, compared with 2.2522 late Monday, according to data provider CQG.
After an emergency policy meeting Tuesday night, Turkey’s central bank said it is raising its overnight lending rate to 12% from 7.75%.