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Toxic Mix Brewing for Ailing Lira as Turkey Economy Shrinks

  • Turkey’s economy contracts for first time in seven years
  • Lira extends sharpest drop among emerging peers this quarter
Bloomberg business news

Lira Leads Declines Among Emerging-Market Currencies

Updated on

Defending the lira has just gotten harder.

The central bank is already under pressure from politicians including President Recep Tayyip Erdogan to cut rates and support the economy, which contracted in the third quarter for the first time in seven years. So while “the plunging lira argues for a hike,” the central bank will struggle to raise rates after this data, said Win Thin, the head of emerging markets at Brown Brothers Harriman & Co. in New York.