Editorial & Advertiser Disclosure Global Banking And Finance Review is an independent publisher which offers News, information, Analysis, Opinion, Press Releases, Reviews, Research reports covering various economies, industries, products, services and companies. The content available on globalbankingandfinance.com is sourced by a mixture of different methods which is not limited to content produced and supplied by various staff writers, journalists, freelancers, individuals, organizations, companies, PR agencies Sponsored Posts etc. The information available on this website is purely for educational and informational purposes only. We cannot guarantee the accuracy or applicability of any of the information provided at globalbankingandfinance.com with respect to your individual or personal circumstances. Please seek professional advice from a qualified professional before making any financial decisions. Globalbankingandfinance.com also links to various third party websites and we cannot guarantee the accuracy or applicability of the information provided by third party websites. Links from various articles on our site to third party websites are a mixture of non-sponsored links and sponsored links. Only a very small fraction of the links which point to external websites are affiliate links. Some of the links which you may click on our website may link to various products and services from our partners who may compensate us if you buy a service or product or fill a form or install an app. This will not incur additional cost to you. A very few articles on our website are sponsored posts or paid advertorials. These are marked as sponsored posts at the bottom of each post. For avoidance of any doubts and to make it easier for you to differentiate sponsored or non-sponsored articles or links, you may consider all articles on our site or all links to external websites as sponsored . Please note that some of the services or products which we talk about carry a high level of risk and may not be suitable for everyone. These may be complex services or products and we request the readers to consider this purely from an educational standpoint. The information provided on this website is general in nature. Global Banking & Finance Review expressly disclaims any liability without any limitation which may arise directly or indirectly from the use of such information.

The Turkish lira and the US dollar – market commentary from David Jones, Chief Market Strategist, Capital.com

Much of the focus for markets in the latter half of last week was the economic turmoil in Turkey. This saw the country’s currency, the Turkish lira, lose a whopping 25% of its value against the US dollar over the course of the week.

Some may wonder what impact this has in the wider world – but of course it is that word that we became familiar with during the various financial crises over the years: contagion.

With a significant portion of the country’s debts in foreign currencies, a plunging lira makes repaying these even more expensive, which goes some way to explaining why we saw a “risk-off” approach by investors towards the end of the week.

But the US dollar gains weren’t just confined to the battered lira. The search for a safe haven also pushed the dollar up against the pound (something that has been going on since April) but more notably against the euro.  After spending the last three months trading in an uneventful and decidedly boring range, EUR/USD moved to its worst levels since July 2017.

It remains to be seen whether this is a real sea-change in sentiment that ends up having more medium-term shock waves, or just a short-term blip.  As the week has started investors certainly don’t yet have the appetite for more risk with the pound and the euro both slightly weaker against the dollar. Foreign exchange markets are likely to be at the forefront of traders’ minds as the week goes on, with UK inflation data out on this morning and Europe revealing its latest numbers on Friday.

After the US dollar experienced its largest 12 month fall in 2017 in 14 years, it has certainly come back with a vengeance over recent months. Given that the memories of the far-reaching effects of the Greek crisis have not been forgotten, do not be surprised if we see cautious trading and further US dollar strength in the days ahead as investors decide that it is better to be safe and late to any recovery – rather than be too early and very wrong.

About Capital.com:

Capital.com is an insurgent fintech on a mission to make the world of finance more engaging, accessible and useful. With an award-winning financial trading platform, available on web and app, it uses patent-pending technologies to revolutionise the trading world.

The platform’s SmartFeed works to detect clients’ trading biases and recommends personalised content to help them trade smarter.

With the ultimate goal of improving clients’ trading performance through education, Capital.com delivers financial lessons, videos, quizzes and more through its Investmate app.

Find out more at https://capital.com/