JP MORGAN CALLS LIRA OVERVALUED BY 13%

Should the Central Bank raise its foreign exchange buying and Turkey’s trade deficit rise, spurring a demand for foreign exchange, the lira’s value might go down, added Morgan. In related news, US investment firm Merrill Lynch said that Turkey’s CB needs a strong lira for disinflation, but faces a dilemma of reducing interest rates and intervening in exchange rates. It added that the expectations regarding high real interest rates and privatization were instrumental in the lira’s appreciation.