Turkish Lira - TRY

A very old currency (the XIX century and the Ottoman Empire), the Turkish Lira (TRY) was indexed to the US dollar after WWII, after having indexed to the pound sterling or the French Franc.

However, the current national currency of Turkey is a new Lira which is worth 1 million old lira on January 1st, 2005.

This creation of a new monetary unity from the previous was due to the major economic crises Turkey suffered at the beginning of the 90s (in particular in 1994, 1999 and 2001).

In 2001, a true economic recession and an important public deficit made the Turkish banking system collapse as the Turkish lira was devalued by 50%.

The secure of the exchange system (creation of a currency board leant on guarantee funds in foreign currencies) led from 2005 to a “virtuous” convertibility of the new Turkish Lira.

The exchange value USD/TRY, which was worth USD/TRY = 1,35 on January 1st, 2005 remained stable until May 2006; then after a small depreciation of the Turkish Lira (USD/TRY = 1,60 in June 2006), the Turkish Lira kept appreciating against the US dollar, so the US/TRY cross kept decreasing on the Forex to a lower USD/TRY=1,15 reached in January 2008.

The high interest rate policy ran by the Turkish monetary authorities seemed to be in favor of this appreciation of the Lira.

As most of the other world currencies, the Turkish Lira clearly lost ground against the dollar in the financial and stock exchange crisis of 2008, and the USD/TRY reached the higher USD/TRY = 1,71 in March 2009.

Since then, a new appreciation of the Turkish Lira has been observed on the Forex where USD/TRY = 1,5332 by the end of November  2009.