ISTANBUL: The Turkish lira edged up in quiet trade on Monday as investors awaited the central bank's quarterly inflation report on Tuesday and a US Federal Reserve rate decision later in the week.
The lira firmed slightly to 1.9222 against the dollar by 1020 GMT, from 1.9240 late on Friday.
"The market is likely to be busy later this week. The central bank's inflation report and how it will react to the recent rise in inflation will be the key agenda element," one forex trader in Istanbul said.
In its last inflation report released in April, the central bank's projection for year-end inflation stood at 5.3 percent, which economists expect will be revised upwards.
The bank last week raised its overnight lending rate to 7.25 percent from 6.5 percent to shore up the lira which has fallen as much as 9 percent against the dollar over the past few months due to capital outflows.
It signalled it would fight further lira falls by tightening liquidity rather than eating further into its foreign exchange reserves, and its liquidity measures are watched closely by markets. The bank injected 2.5 billion lira ($1.3 billion) in a one-week repo auction on Monday.
Three of the world's leading central banks - the US Federal Reserve, European Central Bank and Bank of England - are expected this week to reaffirm their determination to keep a lid on interest rates for a long time to come, despite signs that their economies are slowly mending.
The yield on Turkey's 10-year bond rose to 9.44 percent from 9.23 percent on Friday. The main Istanbul share index was up 0.04 percent at 72,585.80 points.
Shares in Turkish mobile operator Turkcell rose 1.35 percent ahead of a decision from a British court on whether to extend a deadline for Turkey's Cukurova Holding to pay up $1.6 billion to repurchase a controlling stake from Russian group Altimo, a fellow shareholder.
The dispute has left Turkey's biggest mobile phone operator unable to agree the composition of its board, pay dividends or pursue a coherent growth strategy.
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