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Turkey: comparisons with the 2018 currency crisis

The economic and political backdrop in Turkey is eerily similar to that which preceded the currency crisis in 2018, although one key difference now is that the lira doesn’t appear to be fundamentally misaligned. The upshot is that, even if the lira were to endure large and disorderly falls, a prolonged period of severe currency weakness that results in marked balance sheet strains may be avoided.
Jason Tuvey Senior Emerging Markets Economist
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