EUR/TRY Outlook: The outlook for EUR/TRY is likely to increase, supported by its position above the recent average and near recent highs.
Key drivers:
• The European Central Bank maintains a neutral monetary policy, while the Turkish Central Bank has recently lowered its benchmark interest rate, making the Euro comparatively more attractive.
• Crude oil prices have been rising, which can impact the inflation outlook in Turkey and affect the strength of the Turkish Lira negatively.
• Turkey's inflation is accelerating and reached significant levels recently, adding pressure to the currency amid ongoing economic uncertainties.
Range: EUR/TRY is expected to drift within its recent range, as the volatility in oil prices and local economic factors could influence movements.
What could change it:
• An unexpected tightening of monetary policy by the Turkish Central Bank could lend support to the Lira.
• Further escalations in inflation or geopolitical tensions in Turkey may weaken the Lira further against the Euro.
