ISTANBUL: Turkey's lira strengthened on Thursday before the central bank's monthly rate-setting meeting, after which the bank's language will be closely examined.
All 15 economists polled by Reuters expect the Turkish central bank to leave its main one-week repo rate at 8.25 percent when it meets on Thursday. Only one predicted a 25-basis-point cut in the overnight lending rate.
A signal from the central bank over possible rate cuts could hurt the lira, bankers said.
"If we see dovish language that would open the way for (another) rate-cut cycle, we would be inclined to sell the lira versus the dollar," wrote TEB-BNP Paribas strategist Isik Okte in a note.
After a massive rate increase in January to halt a slide in the lira, the central bank reduced rates in May, June, July and August before leaving them unchanged in September.
The lira firmed to 2.2421 against the dollar by 0835 GMT from 2.2464 late on Wednesday.
The main share index rose 0.95 percent to 78,797.10, slightly outperforming the broader emerging markets index, which was down 0.24 percent.
The 10-year benchmark bond yield fell to 8.82 percent from Wednesday's 8.89 percent.
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