Turkish Lira Hits New Low

2025-12-02 13:59 By Joana Taborda 1 min. read

The Turkish lira hit a new record low above 42.4 per US dollar in December, extending its year-to-date decline to around 20%.

The currency’s gradual and managed depreciation, ongoing since July 2023, has persisted amid renewed concerns about the country’s political outlook, which continue to weigh on investor sentiment.

In early November, Finance Minister Mehmet Simsek argued that worries about the lira are “no longer based on fundamentals,” citing a sharp reduction in the current account deficit, improved access to international capital markets, and stronger financial indicators.

Inflation in Turkey eased more than expected to 31.07% in November, a new low since November 2021.

The central bank raised its end-2025 inflation forecast to 31%–33% from 25%–29%, while keeping its 2026 projection at 16%.

The monetary authority has already cut interest rates three times in a row, totaling 650 basis points.

Meanwhile, the Turkish economy grew 3.7% in Q3, slowing more than expected.



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