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Turkey: outlook, fuel prices drive lira to new low

Friday, December 02, 2016 - 01:29

Renewed pressure on the Turkish lira forces it to a record low against the dollar as an uncertain political and economic outlook combines with concerns over the impact of rising oil prices to weigh on sentiment. Laura Frkyberg reports.

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Another grim day for the Turkish Lira Sinking to a new low - against the dollar. And it's forecast to get even worse. (SOUNDBITE) (English) INDEPENDENT MARKET ANALYST, JEREMY BATSTONE-CARR, SAYING: "The economy is weakening, inflationary pressure is building. There is of course major political and geo-political unrest on the country's doorstep. For all these reasons investors are choosing to vote with their feet." Goods in Turkey are now increasingly expensive. Many say it's cheaper to use a more valuable currency. (SOUNDBITE) (Turkish) SHOPKEEPER, SERDAR IYIDELI, SAYING: "We buy everything with dollars, but right now we cannot pass through the price hikes on customers." (SOUNDBITE) (Turkish) RESIDENT OF ANKARA, YELIZ, SAYING: "It affects our daily lives. The prices are constantly changing. We cannot buy anything for the same price. Prices have changed in a week. Our purchasing power has weakened." Last week the central bank raised rates to try and stop its slide. Despite President Erdogan's call to lower borrowing costs. It didn't work anyway. Traders appear concerned with other uncertainties. The government is presenting a proposed constitutional change next week. If it goes ahead it will be Turkey's fifth national vote in three years. Distracting policymakers - they say - from more pressing issues - like much needed reform.

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Turkey: outlook, fuel prices drive lira to new low

Friday, December 02, 2016 - 01:29