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Lira falls as Turkey purge deepens

Wednesday, July 20, 2016 - 01:49

Turkey's currency, the lira, comes under new pressure as markets react to the gathering momentum of President Erdogan's purge: 50,000 soldiers, civil servants and officials suspended or detained since last week's abortive coup. Kate King reports.

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The numbers are staggering. As many as 50-thousand soldiers and public servants have now been affected by the Turkish government's post coup purge The uncertainty of what, or who, maybe next reflecting in the markets The Lira tumbling against other currencies- On the day of the uprising it suffered its biggest one day drop in eight years It's since recovered slightly, but remains at 10-month lows. (SOUNDBITE) (English) IMF, ECONOMIC COUNSELLOR AND DIRECTOR OF RESEARCH, MAURY OBSTFELD, SAYING: "In Turkey, we are watching the situation carefully since it is dynamic and is evolving." On Tuesday Turkey's Central Bank cut interest rates for the fifth straight month. According to a Bank of America Merrill Lynch survey - geopolitical risk is now the biggest factor for investors when considering financial market stability. (SOUNDBITE) (English) INDEPENDENT MARKET ANALYST, JEREMY BATSTONE-CARR, SAYING: "Ok the coup has failed Erdogan has moved very quickly to root out any potential dissent and yet at the same time it is right that it has left a nasty taste in the mouth and therefore I think investors are right to cite uncertainty with turkey going forward." Credit rating agency Moody's has placed Turkey's bond ratings on review for downgrade. But it's the immediate response worrying many, with further, tougher, measures expected to come out of a National Security Council meeting (SOUNDBITE) (English) HURRIYET DAILY NEWSPAPER POLITICAL COLUMNIST, SERKAN DEMIRTAS, SAYING: "Maybe even there will be some attempts to change the constitution, to make the hands of the government much stronger in the fight against these plotters within the state." That ensuring security for the government, but perhaps not the currency, which seems to be directly linked to how heavy-handed President Erdogan is.

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Lira falls as Turkey purge deepens

Wednesday, July 20, 2016 - 01:49