ISTANBUL: The Turkish lira weakened in thin trade on Tuesday after data showed the U.S. economy grew in the third quarter at its quickest pace in 11 years, a sign the Fed could to start raising interest rates by the middle of next year.
Market attention was focused on Wednesday's Turkish central bank policy-setting meeting where rates are expected to be kept on hold after the lira touched its weakest-ever levels against the dollar last week.
The lira eased to 2.3230 against the dollar by 1428 GMT, from 2.3185 on Monday.
In a report released on Tuesday, the World Bank said it expected Turkey's gross domestic product (GDP) to grow 3.5 percent in 2015, helped by the sharp fall in energy prices, which will also support lower inflation and reducing the current-account deficit.
Inflation may be 6.7 percent by the end of next year, it said in an e-mailed statement. The main downside risk for the positive outlook is the lira's renewed depreciation, which highlights a vulnerability to investor sentiment and reduces the ability to manoeuvre on monetary policy, it added.
The World Bank estimated the 2014 current account deficit will be 5.6 percent of GDP and said global market volatility and political uncertainty will continue to burden private investments in Turkey in 2015, whereas it expected private consumption to return to being the main driver of growth.
Turkey's main stock index was down 0.13 percent at 85,033.25 points, outperforming the emerging market index which was down 0.72 percent.
The 10-year benchmark bond yield fell to 8.02 percent from 8.1 percent on Monday.
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