The Turkish lira has updated a record low in anticipation of the Central Bank meeting

The Turkish lira hit a new historic low on Tuesday, as the Central Bank and national banks stopped supporting the national currency in anticipation of the next meeting on the issue of the base interest rate. 

Most analysts predict that on Thursday the Central Bank of Turkey will raise the rate on seven-day repo transactions to 20% per annum from the current 15% per annum, which will be the highest level since November 2011. 

Today, the rate of the USD/TRY pair rose to the level of 27.0847 lira for 1 dollar. The current quote of the asset is 26.9223. Over the past year, the lira has lost half of its value. The BIST 100 stock index has fallen by 3% since the start of trading on Tuesday, but it has grown 2.6 times over the year.

Additional pressure on the lira exchange rate was exerted by the decision of the authorities to raise the gasoline tax last weekend, the completion of the grain deal, as well as the news that Turkey's budget deficit increased seven times compared to last year. An increase in the gasoline tax may provoke inflation: in June it fell to 38.21%, and in October 2022 it was a record 85.51%.