Since intervention, TRY speculation is less attractive
Updated
Pros
REER based TRY undervaluation: 47%
National Bank stepped in to protect TRY
Key to this position: limited market volatility and risk-on sentiment
It is relatively expensive to short the TRY
Cons
Long-term fundamentals gloomy for Turkey
REER based TRY undervaluation: 47%
National Bank stepped in to protect TRY
Key to this position: limited market volatility and risk-on sentiment
It is relatively expensive to short the TRY
Cons
Long-term fundamentals gloomy for Turkey
Comment
Tomorrows CBT interest rate decision critical risk-event. Market is pricing a hike of roughly 50-75 bps on average, anything below that means TRY under attack again.Comment
Setup playing out well: Turkey announces a 125bp hike in the repo rate, thats more than expected, lira on the frontfootOrder cancelled
No positioned opened on this setup, very speculative, hard to build an edge on a market where Central Banks can intervene at any moment.
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