It was supposed to be, according to analysts, the last week of quiet before the autumn tests. But the crisis in Türkiye has upset the plans of the operators. The storm over the Turkish lira does not subside. Indeed, it promises another day of fire after Friday's chills.
The euro hit 1,1370 against the dollar in Asia this morning, a 13-month low and down sharply from Friday's 1,1628, before all hell broke loose on Erdogan's currency, which since the beginning of the year has lost more than 40% of the value.
In order to stem the collapse, the Turkish Central Bank has announced that it will take "all necessary measures" to ensure the country's financial stability, providing the liquidity that banks operating in Turkey will need.
Meanwhile, the race of speculation towards "safe havens" has begun: the yen rises to 125,45¸ as does the Swiss franc, which has jumped to 1,1300, its highest for a year against the European currency. The 2-year US bond also strengthened (+XNUMX points).
EMERGING CURRENCIES ALSO SUFFER
The storm hit emerging currencies even more. The South African rand suffers the most (-10,4% against the dollar at 14,76) and the Argentine peso, but the malaise has also infected the Indian rupee which reaches an all-time low against the dollar at 69,5 and the yuan down to 6,87 against the dollar: the lira crisis has laid bare the concerns of emerging markets in the face of the strengthening of US rates.
Stock lists are also under fire. All Asian stock markets are down. Tokyo's Nikkei index is down 1,9%. Hong Kong -1,8%. CSI 300 index of Shanghai and Shenzhen stock exchanges -1,8%. Seoul -1,7%, Mumbai -0,7%.
Futures anticipate a negative opening also for European lists: -0,5% for the London Stock Exchange.
THE LIRA SLIDES TO 7.000 ON THE DOLLAR
Turkey, the epicenter of the crisis, remains under the greatest pressure. The lira slipped to 7.000 against the dollar: a month ago the exchange rate, already under tension, was at 4,8450. Against the euro, the Ankara currency reached 7.200. But the landslide hasn't stopped yet, despite an intervention by the finance minister, the president's brother-in-law. Berat Albayrak who announced "an emergency plan". Words that fell on deaf ears, after the challenge launched by Erdogan: “We will not give in – said the president-sultan – to the blackmail of interest rates. We will look for new allies”.
Brent oil down slightly to 72,6 dollars, from -0,5% last week. Turkey's approach to Tehran (which is already the largest supplier of crude oil to Ankara) does not affect the market.
THE CRISIS ALSO HEATS UP THE TAP DOSSIER
The threat of Turkey leaving NATO, combined with the heavy debt exposure to European banks (Unicredit lost 4,9% on Friday) partly explains the storm that hit the euro area.
The "Turkish things" are destined to influence the debate on the Italian autumn maneuver which in a few weeks will have to face the scrutiny of the rating agencies (31 August Fitch, 7 September Moody's). The spread restarts this morning from 270 after the strong increase at the weekend.
On another level, the Turkish crisis invests the debate on the TAP, the gas pipeline that will have to transform the gas from the shores of the Caspian Sea to Southern Italy passing through Turkey.
THE AGENDA: INFLATION, US JOBS, WAL-MART ACCOUNTS
The other events fade into the background, in a week with a slim agenda.
Today Istat communicates inflation data.
On Thursday the negotiations between the EU and the United Kingdom on Brexit resume in a peak of great pessimism.
In week 14, 500 companies in the S&P XNUMX index will give results. Wal-Mart stands out among these.
Data on consumer prices and employment are also on the way.
