Gaps on the USD/TRY are expected in today’s open following the news that President Tayyip Erdogan abruptly sacked Turkey’s central bank chief on Saturday.

A sharp interest rate hike to head off inflation was unwelcomed and Tayyip has thus replaced the former chief with a former ruling party lawmaker and critic of tight monetary policy.

It was the third time since mid-2019 that Erdogan has ousted a bank governor.

The shock removal, announced in the early hours of Saturday, has come after the bank hiked rates by a greater-than-expected 200 points on Thursday in a “front-loaded” move designed to curb inflation, currently around 16%, and support the currency. 

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