An article in the Wall Street Journal with a reminder on why the developing crisis in Turkey is important beyond that country alone
- Emerging-market investors are preparing for an unsteady start to the week
- President Trump on Friday doubled steel tariffs on Turkey as its government battled the currency collapse. The decision marked a departure for the U.S., which has generally tried to calm global markets during times of financial turmoil in emerging markets, especially when investors are gripped by fear of contagion.
- The decision deepened the lira's drop and worsened market fears that the weaker currency could exacerbate fragilities in the economy, making it harder for the heavily indebted corporate sector to pay back domestic and foreign loans, putting strains on the country's banks.
And, more broadly ….
- investors are watching how emerging-market currencies react, as well as foreign government debt for signs of contagion
Link to the Journal, may be gated
Earlier on Turkey and the TR if you need a catch-up:
- TRY: Communications Director for the Turkish Presidency - more tweets
- DM currency gap fill nearly filled, TRY ... not so much
- Analysts Sunday notes in response to Turkey and sliding TRY
- Turkey bank regulator limits swap transactions
- Communications Director for the Turkish Presidency warns on TRY FX rate
- More on Turkey's fin min saying action to be taken Monday to ease market concerns
- Turkish fin min says will take steps Monday morning to ease market concerns
- (Very) early Asia FX rate indications - eyes on a plunging TRY
- Turkish lira smashed again as trading for the new week begins
- Why the Turkish lira is imploding
