Photographer: Kerem Uzel/Bloomberg

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This Volatile Currency Has Most Boring Start to Year Since 1990

Trading the Turkish lira this year is like watching paint dry.

The currency is off to the least eventful start to any year since at least 1990, having budged a mere 0.1 percent against the dollar, and the swing between its high and low this year is at its narrowest since 2013. The lira missed out on a rally as the greenback fell and it’s been little changed as the U.S. currency pulls back.

While that may be a welcome turn of events for central bank governor Murat Cetinkaya, who has to shepherd this notoriously volatile currency, it highlights the extent to which two opposing forces have wedged the lira into such a tight trading range.

The currency’s juicy yield makes it too expensive to short: the one-month implied return adjusted for volatility is almost double that of its major peers. But risks ranging from inflation that’s far too high to Syria’s seven-year war raging at the border, stand in the way of any meaningful rally.

The currency’s one-month implied volatility is among a handful in emerging markets to fall this year, although at 11.4 percent it’s still among the highest.

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