Turkey's lira weakens more than 3pc after nationalists say to ditch AKP alliance

ISTANBUL: Turkey's lira weakened more than 3 percent on Tuesday, put it on track for its worst day in more than a month, after the nationalist party said it would not seek an alliance with President Tayyip Erdogan's AK Party in 2019 local elections.

The lira weakened to 5.8475 to the dollar by 0857 GMT from Monday's close of 5.6640.

The currency has lost nearly 35 percent of its value against the dollar this year on concerns over the central bank's ability to rein in double-digit inflation faced with Erdogan criticism and a rift with Washington.

The central bank will hold its next rate-setting meeting on Thursday. Twelve out of 15 economists in a Reuters poll said they expect the central bank to keep its policy rate unchanged, after a mammoth 6.25 percentage point rate hike in September.