Turkish Lira Weakens after Turkey’s Military Incursion in Syria

By Staff, Agencies

The Turkish lira weakened against the dollar Thursday as investors fretted about negative international reaction to a military incursion launched by Turkish troops against the Kurdish militia in northeast Syria overnight.

The lira weakened to 5.88 against dollar from a close of 5.8740 a day earlier. It weakened 0.5% Wednesday when the operation began with air strikes.

Turkish troops were attacking the Kurdish militia in Syria which Ankara regards as a terrorist organization, pounding them with air strikes and artillery before starting a cross-border ground operation.

The lira has come under pressure since the US White House announced the withdrawal of US troops from the Syrian region near Turkey's border. The subsequent military operation has drawn almost universal condemnation internationally.

Investors are concerned about proposed US sanctions on Turkey following the start of the incursion, including targeting Ankara's military transactions and US assets of Turkish President Recep Tayyip Erdogan.

"We can say that the current pricing in the market is more focused on geopolitical concerns over international reactions to the Syria operation," a senior banker said.

The market pressure could continue until Erdogan and US President Donald Trump meet in November, the banker said.