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Turkish currency rebounds after worst drop since 2018 crash

By Nicholas Sakelaris
Turkish President Recep Tayyip Erdogan warned foreign banks not to speculate against the Lira. Photo by Stringer/EPA-EFE
Turkish President Recep Tayyip Erdogan warned foreign banks not to speculate against the Lira. Photo by Stringer/EPA-EFE

March 25 (UPI) -- Turkish currency bounced back Monday after experiencing the worst drop since it crashed in 2018, positive news with the March 31 election looming ahead.

The Turkish lira rose 1.3 percent to 5.6819 versus the dollar, recouping Friday's losses where the currency fell 5 percent. Turkish President Recep Tayyip Erdogan had strong words for foreign banks betting against the Lira. Turkey has launched a probe into JPMorgan Chase & Co and other banks for interfering and encouraging the Lira's fall.

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"If you are soaking up foreign currencies from the market and engaging in provocative actions," there will be "a heavy price for that," Erdogan said at an election rally Sunday.

Turkey's Banking and Regulation Supervision Agency said Chase gave guidance that was "misleading and manipulative." The country's Capital Markets Board launched its own probe.

Turkish investors accumulated $25 billion of hard currency since September to hedge against runaway inflation.

The strength of the Lira Monday contrasted with the huge losses seen in Asian currencies Monday.

"The Turkish Lira's comeback will be limited however as EM in Asia will be under pressure following the price action across markets on Friday," said Jeff Halley, senior market analyst at Oanda Corp. in Singapore.

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