Volatile Turkish Lira Offsets Some of Its Early Losses, at 7.8 per Dollar

The lira partially recovered to 7.8 against the dollar on Monday, after falling 15% to an all-time low in early trade following President Recep Tayyip Erdogan’s shocking decision to dismiss the central bank governor.

The lira tumbled as much as 8.4850 against the dollar from 7.2185 on Friday, returning to levels touched in early November, when it hit a session record at 8.58. With the Japanese market closed, it was trading at 7.83, down 8 percent from Friday.

The decision to dismiss the central bank governor raised concerns about a backtracking on the recent interest rate hike and undermined the bank’s credibility.

Amidst the chaos in the market, Finance Minister Lotfi Alwan issued a statement saying that Turkey is determined to abide by the rules of the free market and the free circulation of currency and that financial policies will support monetary policies to achieve price stability.