Turkish Exchange Rates in the WorldSun, Dec 18, 2022 12:00 AM
Over the course of the last 5 years Turkish lira is experiencing a significant devaluation against almost all currencies. In 2017, one United States Dollar was equal to approximately four Turkish liras while 1 Euro was 5 TRY and 1 GBP was 5,7. The Turkish Exchange Rates are now, 1 USD to 18.6, 1 Euro to 19.7 and 1 GBP to 22.7 TRY.
If you are wondering what caused such a devaluation of a once stable currency, the answer is not really simple. For years the Turkish currency was stable against the foreign currencies, it was generally between 2 TRY and 5 TRY per USD for years but lately there are variety of reasons behind the currency’s sharp devaluation since late 2019 and early 2020 when the coronavirus first began.
Coronavirus was first seen in December 2019 but it was not a major concern for at least 3 more months. First, there were news of an outbreak of some sorts but then the real face of the coronavirus shown itself. The countries all over the world began to issue total lockdowns to suppress the contagions and keep the infected people numbers to the minimum. The disease was a silent killer because at first it started as a common cold and sometimes it didn’t even show any symptoms but kept spreading. Total lockdowns were the last resort of humans until a cure or a vaccine was found.
Türkiye went into a total lockdown relatively late against the rest of the world and it was a surprise for everyone. Türkiye was unprepared for a pandemic and a total lockdown. The covid detection tools were not readily available and as Türkiye is an international trading and tourism hub, the virus spread very fast. It was in March 2020 when Türkiye went into a lockdown and with lockdown new rules came. Everything except the “essential” businesses were shut down and this protocol went almost a year. As it is clear that going into lockdown severely damages businesses and that in turn damages the economy.
An Economic Struggle
The lockdown in May 2020 was the beginning of the strong devaluation since the Turkish exchange rate versus dollar was still around 6 TRY per USD. It was in 6th of March when the TRY was at the all time low versus USD with a 6.6 TRY per dollars. The lockdown rules were eased when in the summer season. Due to the summer season, eased restrictions and the vaccine the economy was looking a bit better. During the summer season Turkish Exchange rates against dollar, euro, pound and many more were pretty stable and even gained a %5-10 value over other currencies.
A Year of Absence
The summer season in Türkiye didn’t satisfy the expectations but it helped the economy to stay stable until the end of the year. Meanwhile, there as shortage on food, microchip, cars, oil and much more in the world. These shortages in the world slowly crept up and took a hold on the Turkish economy and inflation started to soar boosted by the devaluation of the lira and unbalanced Turkish exchange rates.
A Sacrifice for the Growth
Near the end of 2019, Turkish President Recep Tayyip Erdoğan had a vision about the borrowing costs and interest rates and he was a firm believer of cutting rates for growth and stimulating developments. With some important changes in the monetary policies of Türkiye and the changes in the government positions about these policies, the currency started to decline sharply. In September 2021, the Turkish exchange rates against were 8.8 TRY per USD, 10.2 TRY per EUR and 12 TRY per GBP meanwhile since September to 17 December 2021, Turkish Lira experienced very sharp devaluation against all currencies making it the new all time low at that time with a 16.4 TRY per USD, 18.4 TRY per USD and 21.7 TRY per GBP.
Every Cloud Has a Silver Lining
Since last years, Covid Pandemic, the war between Russia and Ukraine, food, microchip, fuel etc. shortages, rate cuts and dollar gaining value over other currencies have been taking its toll on the Turkish Lira and it causes a massive inflation. According to the President Erdoğan the rate cuts are necessary to boost the development, growth and to be independent from the influence of other countries. Currently with the explanations of the Federal Reserve Chairman Jerome Powell on the 16th of December a new record low has been seen in Turkish Exchange rates against other currencies. The rates are 18.6 TRY per USD, 19.8 TRY per Euro and 22.7 TRY per GBP.
An Analysis on the USDTRY Pair
According to the current analyzers “The price of the try/usd has stabilized despite the strong movement in global markets since yesterday, after the decision to raise interest rates in the United States of America by 50 basis points. Despite the rise of the dollar at the present time against major and emerging market currencies, especially after the statements of Federal Reserve Chairman Jerome Powell, who stressed adherence to a restrictive fiscal policy until inflation recedes.”
Despite the devaluation of the Turkish lira and the weak Turkish exchange rates it is an opportunity for the foreign investors. Currently, Türkiye is a rapidly developing, geographically, economically and politically important country with in between Asia, Europe and Middle East. Türkiye has 3 seas around it and 4 seasons with lush forests to walk, fertile soils to farm, clean seas fish and swim, every type of activity you can imagine, night life, natural life or anything you can imagine.
Türkiye also has a very competitive real estate market which is pretty lucrative in the long run. Most of the visitors prefer to visit Türkiye again and there are those who love it so much that make investments in Türkiye to maybe own a summer property, have a business opportunity or even try to gain citizenship. Türkiye is a must-see country for its riches and it is pretty cheap against other countries. So, property for sale in Istanbul, contains remarkable opportunities.