ISTANBUL — August 13, 2026
Commerzbank expects the Turkish lira to face further depreciation through the end of the year, warning that managing the exchange rate could become increasingly challenging.
In a note published Thursday, Commerzbank strategist Tatha Ghose said Türkiye’s net foreign-exchange reserves excluding swaps remain relatively modest, while the Central Bank of the Republic of Türkiye (CBRT) and state-owned banks are under significant pressure to use foreign-exchange interventions to cushion the lira’s losses.
“The USD/TRY chart tells a familiar story,” Ghose said, noting that the exchange rate continues to move through periods of stability before jumping to a new level. He described this as a pattern of “successive lines of defense being breached.”
Ghose argued that the outlook is not healthy for the Turkish currency. While policymakers can slow the pace of the lira’s depreciation, they cannot fundamentally change its direction, he said, adding that this policy dilemma remains negative for the lira.
Inflation Strategy Faces Additional Challenges
According to Ghose, Türkiye’s disinflation strategy is facing a double challenge: inflation had already failed to show improvement even before the outbreak of the war, while an externally driven price shock has added further pressure.
Ghose also commented on remarks by CBRT Governor Fatih Karahan during Thursday’s Inflation Report presentation that the central bank could consider restarting one-week repo auctions in the coming period.
Such a move would mechanically reduce the effective funding cost and would effectively be equivalent to an interest-rate cut, Ghose said. Although it could be described as “technical normalization,” foreign-exchange markets would likely interpret it as monetary easing.
Overall, Commerzbank sees the combination of limited reserves, continued exchange-rate pressure and potential monetary easing as a negative backdrop for the Turkish lira through the remainder of 2026.
Source: Patronlar Dünyası/ Prepared by: İlayda Gök