Turkish lira rebounds as Erdogan is sworn in as president

Thomson Reuters

Turkish President Erdogan greets his supporters during a ceremony in Istanbul

• Recep Tayyip Erdogan was sworn in Monday as president of Turkey.
• The lira rebounded from its weakest levels of the day against the dollar and was nearly unchanged at 4.573 per dollar around 11:11 a.m. ET.
• Follow the lira in real time here.

The Turkish lira inched higher Monday after Recep Tayyip Erdogan was sworn in as president. He grabbed newly-granted executive powers as he secured another 15-year term.

The lira was nearly unchanged at 4.573 per dollar around 11:11 a.m. ET, climbing from session lows. It earlier weakened to 4.605.

The highest electoral body in Turkey certified last week an Erdogan win in the June 24 snap elections, which also marked the country's shift from a parliamentary system to a more powerful presidency.

Concerns about how Turkey will manage the lira, which hit an all-time low in May, under another Erdogan term had been mounting in the months leading up to the election. A weakening currency and rising global commodity prices have pushed core inflation in the country to about 15% year-over-year.

Erdogan signaled earlier this year he would pursue wielding more influence over the country's central bank upon winning another term. The self-proclaimed "enemy of interest-rates" has pushed for unorthodox policies like cutting borrowing costs amid accelerating inflation.

Still, analysts at HSBC expect the central bank to raise its main rate by 250 basis points in the third quarter.

"The broad-based nature of price pressures and the extent of pass-through from FX weakness evident in the June inflation release prompted us to revise our interest rate view," the analysts said.

The lira is down nearly 21% against the dollar this year.

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