Turkish lira weaker, bonds flat before CPI data
ISTANBUL: The Turkish lira weakened slightly on worries about faltering global economic growth and bond yields remained flat in early over-the-counter trade on Monday while investors waited for August inflation data.
The lira traded at 1.7610 by 0642 GMT versus the dollar compared with a previous close of 1.7450.
"Worries about Greece created pressures on European and Asian markets. On Friday weaker-than-expected US economic data also created serious selling. We see some weakening in the lira following the rise in the EUR/USD rate," said a banker.
"After the holiday wee could see the lira moving towards the 1.7700 level if local demand continues for buying dollars. Today US markets are closed and Turkey's inflation data will be important," he added.
US markets will be closed on Monday for Labour Day.
The benchmark May 15, 2013, yield stood at 7.80 percent in early over-the-counter trade on Monday unchanged compared with its previous closing level.
"Bond yields remain flat for now. But the inflation data, Treasury auctions and the lira's trend will determine the market. I think the benchmark yield could fluctuate between the 8-7.75 levels according to the inflation data," a portfolio manager said.
The Turkish Treasury will issue on Sept. 5 a fixed coupon bond maturing on June 4, 2014. The Treasury will also tap on Sep. 6 the current benchmark bond maturing on May 15, 2013, and issue a fixed coupon bond maturing in January 2020.
Turkish August CPI is seen at 0.40 percent month-on-month according to a Reuters poll of 15 economists. Data will be released at 0700 GMT.
The main share index closed 2.65 percent higher at 55,760.63 points on Friday.
"We expect weak trade ahead of inflation as global sentiment is souring across the board. Today's inflation print should be no news if consensus of 0.43 percent is not breached. Attention will turn towards tomorrow's Turkey's Central Bank investors meeting in Ankara." wrote Oyak Securities in a daily research note.
Copyright Reuters, 2010
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