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NAVIGATING THE TURKISH LIRA CRISIS

Will Turkey’s currency turmoil pose broader economic challenges across global financial markets? PGIM’s managers discuss a confluence of factors that led to the free fall in the lira, and potential outcomes to monitor.

PGIM FIXED INCOME

Free Falling Turkish Lira—What’s Next?

By Jurgen Odenius, Economic Counsellor, Macroeconomic Team, PGIM Fixed Income

This paper explores how, without comprehensive policy action, the free fall in the lira is likely to continue and risks unleashing a full-blown run on the banks and the $147 billion in resident dollar deposits. In principle, the policy options are clear but, as so often, all are politically costly, although to different degrees.

QMA

Talking Turkey: What Drove the Crisis, and Where Does It Head Next?

The recent crisis in Turkey looks to us more like a symptom than a catalyst for the global economic challenges that are starting to cause us some concern.

PGIM GLOBAL PARTNERS

Financial Crisis In Turkey – Contagion Risks & Outlook

Recently, the value of Turkey’s Lira caused a sharp sell-off in the equity market, causing the currency to plunge, and a spike in bond yields. In this paper, PGIM Global Partners looks at the origin and causes of the crisis, the risk of contagion to other markets, the policy options for Turkish policymakers, and an outlook for resolution of the crisis.