Turkish lira ends Eid's with bitter setback, Erdoğan's tone ironic

NEWS DESK

In a new twist to the lira slump, the Turkish currency was hit by a fresh blow on Monday after its decline to 3 % against the dollar as domestic markets resumed after a week-long holiday as investors focused again on the dispute between Ankara and Washington over a US priest who is being subjected to trial in Turkey.

As the dollar rose globally, the Turkish currency fell to 6.19 lira to the dollar, compared with six lira at closing on Friday before Eid al-Adha.

The lira has lost about 39 % of its value against US currency since the beginning of the year.

International reports indicate that companies’ debts in foreign currency has become a ticking bomb because of rapidly increase in its burden as the local currency deteriorates, which has lost about half of its value since the beginning of the year, doubling its value when calculated in Turkish lira.

The reports confirm that the most major companies are threatened with declaring bankruptcy because they cannot afford the debt, in addition to the risk of shifting the burden to local banks, which also have large debts to those companies, especially government banks.

The tone of Turkish President Recep Tayyip Erdoğan and his insistence on not declaring bankruptcy are revealing the magnitude of the danger, the thing which the analysts have ridiculed because the companies do not have the option of not declaring bankruptcy if debts accumulate.

H/S

ANHA