Turkey warns banks not to lend to firms trading liras offshore

Turkey warned money lenders not to provide lira liquidity to companies looking to speculate in the offshore money market, Bloomberg reports.

According to the report, Turkish lira’s offshore swap on Tuesday was becoming more difficult for foreign investors to hedge their exposure to lira assets. Due to offshore swap increase, Turkey’s banking regülatör warned banks not to support investors trading liras offshore.

The warning came a day after the President’s firing of a respected Central Bank chief.

Last week, the market investors were also well accustomed to unpleasant surprises from Turkey.

According to the Financial Times, a late-night weekend firing of a respected Central Bank governor who had been in the job for just four months — has left them reeling.

According to experts, Turkish money is more volatile than bitcoin. Therefore, the investors see the assets with high volatility readings as risky investments.

Turkish President, Recep Tayyip Erdogan, has been following a strategy of reducing interest rates at times of rising inflation.

READ: Turkish Finance Minister visits London amid currency crisis