Turkish Lira Holds at Record Lows

The Turkish lira hit a new record low of 41.9 per US dollar in October 2025, extending its year-to-date decline to around 18%.

The currency’s gradual and managed depreciation has persisted since July 2023, when President Erdogan appointed a more orthodox economic team.

The Central Bank of Turkey has maintained a firm presence in the foreign exchange market to keep tight control over the lira’s movement and the government continues to pursue a policy of so-called “real appreciation”.

On the monetary policy front, the central bank cut rates by 100bps in October, in line with expectations.

This marked the third consecutive rate cut, though the smallest in the current easing cycle, as inflation accelerated for the first time in fifteen months, reaching 33.29% in September.

Separately, a Turkish court ruling on the leadership dispute within the main opposition CHP, scheduled for October 24, poses a potential source of renewed volatility in the country’s markets.