USD/TRY: Lira down but not out after US terminates preferential trade agreement

• US terminates preferential trade agreement, Lira drops to four-day low and recovers.
• The US reduces tariffs on Turkish steel.

Turkish Lira (TRY) has come under pressure this Friday morning in Asia, possibly in response to the decision by the US to terminate Turkey’s preferential trade treatment that allowed some exports to enter the country duty free.

USD/TRY rose to a four-day high of 6.0940 earlier today and is currently trading at  6.0672, representing 0.39% gains on the day.

The TRY is down but not out in a sense that it is still trading well above the recent low of 6.2458 per US Dollar reached on May 9.

Lira’s resilience could be associated with US’ decision to cut tariffs on Turkey by half.

On Thursday, the Trump administration trimmed special tariffs on Turkish steel from 50% to 25%.

Technical Levels

Resistance: 6.13 (May 13 high), 6.2458 (May 9 high)

Support: 5.9807 (previous day's low), 5.9472 (May 10 low)