Dollar/TL is at its highest, eyes are on interest rate decision and KKM

Although the USD/TL followed a relatively flat course at the peak of 27.20, the effects of the measures of the Central Bank (CBRT) aimed at reducing the protected deposits in currency (KKM) are observed in the markets before the decision of the interest rate to be announced tomorrow. .

The CBRT will announce its interest rate decision at 2:00 p.m. tomorrow, with its revamped staff, including Cevdet Akçay, Fatih Karahan and Hatice Karahan, following the 900 basis point interest rate hike, which was below The expectations.

The 17 economists polled by Reuters expect a policy rate increase of 17.5 percent, while estimates are in the range of 18 to 20.5 percent. The poll median is 20 percent, an increase of 250 basis points. Eight economists expect 250 basis points, four economists 200 basis points, three economists 150 basis points, and one economist 50 and 300 basis points in the survey.

KKM DECISION

The CBRT took the first step over the weekend, aiming to reduce KKM, by setting a target for banks to transition their KKM accounts close to $125 billion to TL deposits. According to bankers, this decision is also an indication that interest rate increases will remain limited.

The CBRT also held a meeting on Monday, where it heard the criticism of the banks regarding its new steps. The CBRT sent the message to the banks that they were “aware of the difficulties” but that the regulations were “necessary” for a healthy transmission mechanism.

Stating that KKM is still the most attractive product today and that they will continue to offer KKM to their customers, İşbank CEO Hakan Aran, on the BloombergHT broadcast he attended yesterday, said: “It is not possible for us to convince them in line with the goals we have been given. We will not have a suggestion for those who return from foreign currency and switch to KKM, saying ‘switch to TL term deposit account.’”

The bankers draw attention to the fact that the decisions of the CBRT are directly focused on the KKM, which was opened with TL in the first place. Bankers estimate that about 20 percent of KKM consists of accounts opened with TL and 80 percent of accounts opened with foreign currency. The 15 percent decline expected by the end of the year with these regulations at KKM demonstrates that the exit from KKM will be a process that will take place over the years.

Today, the August consumer confidence index is on the internal data agenda. The economic administration continues its consultations on the medium-term program, which is expected to be announced next month.

THE NEW SUMMIT IN THE CURRENT

Dollar/TL began the day by rising to its new high at 27.2150. After following a flat course at 27 for about a month, it has risen from 27 to 27.20 in the last few days. The depreciation of the lira against the dollar since the beginning of the year is 31.22 percent this morning.

KKM’s record returns in August continue to be followed in the markets. With KKM returning $50 billion this month, exporters’ need for foreign currency from imports are the main factors putting pressure on CBRT reserves.

According to bankers’ calculations, data to be released on Thursday shows total reserves will rise by $800 million to $1 billion last week, while net reserves will decline by $200 million.

GLOBAL MARKETS

Investors are waiting for Nvidia’s balance sheet to be announced today to see if high-value companies in the tech industry can withstand the sharp jump in bond yields.

Wall Street plunged yesterday as bond yields soared to a 16-year high.

Investors are waiting for the statements of the president of the Federal Reserve (Fed) of the United States, Jerome Powell, at the Jackson Hole conference, which he will attend this week, to have clues about the way forward in monetary policy . The dollar is around the maximum of two months before the conference. (Reuters)