The Turkish lira slammed by turmoil

 @ibtimes
on February 25 2010 9:14 AM

The Turkish lira is now victimized by the heavy pessimism and fear in the market and expected to lose strongly its glorious status and fall as one of the worst performing currencies.

Investors are increasing their bets that the political turmoil in Turkey following the arrest of 40 army officers on the back of an alleged coup plot intensified the tension between the military and the government. Turkey's stocks bonds and currency slumped this week on the back of this rising tension between the Turkish Prime Minister Recep Tayyip Erdogan and the army which has already ousted four governments since 1960.

Investors are increasing their bets of further decline for the Turkish lira, which already slumped to a seven-month low versus the dollar and likely to continue to weaken further, as according to expectations the USDTRY will continue to rise from current levels around 1.54 towards 1.60. The one-month put option which grants investors the right to sell the currency, has rallied to a 3.4% premium aver their call option which is determining the bearish sentiment in the market.

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