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Turkish lira takes another dive against US dollar

2 January 2014

The Turkish lira fell to a new all-time low against the dollar on Thursday as an investigation in high-level corruption spotlighted individuals close to the government, causing continued upheaval in markets.

The lira lost around 20% of its value against the dollar in 2013. Turkey, particularly dependent on foreign funding to finance its continuing current account deficit, looks particularly vulnerable as the cessation of US Federal Reserve funds looms on the horizon.

The currency fell by more than 6% against the dollar following the news of corruption in high places and as the ongoing political upheaval continues to unnerve investors.

Last week, Turkey’s Central bank pumped $100 million into markets to help stabilise the currency but today, it reduced the size of its daily auction and the lira slid to a new low of TL 2.184 against the dollar.

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