Goldman Sachs Dollar To Turkish Lira Forecast: USD/TRY To Rise To 54 In 12 Months - Exchange Rates Org UK

What the desk is arguing

The desk asserts that the USD/TRY rate is poised to rise to 54 within the next 12 months, reflecting ongoing economic instability in Turkey. Per Goldman Sachs' analysis, multiple factors, including high inflation rates—reported at approximately 60%—and limited foreign investment, are contributing to a weakening lira.

Supporting this thesis, Goldman Sachs points to the potential for drastic monetary policy adjustments by the Turkish central bank, which is currently under pressure amid a challenging fiscal landscape. This suggests that without effective interventions, the depreciation trend could escalate, leading to the projected target.

Where it sits in our coverage

The current consensus among leading firms showcases a range of targets for USD/TRY, with jpmorgan at 1.10 and bofa at 1.04 for the Dec-26 timeframe.

Goldman Sachs' view positions itself notably towards the higher spectrum of expectations regarding lira depreciation, indicating a potential misalignment with other firms forecasting more moderate movements. This divergence highlights the high uncertainty surrounding Turkey's economic outlook and central bank policies.

How other firms see it

Firms such as jpmorgan and bofa represent polarized views on the USD/TRY dynamics, with jpmorgan anticipating continued lira weakness while bofa remains more cautious about the extent of depreciation. The general sentiment appears to lean towards a bearish outlook for the lira, albeit with varying degrees of severity.

Additionally, the trajectory of the EUR/USD could have spillover effects on emerging market currencies, including the Turkish lira, as shifts in Eurozone monetary policy may influence global risk sentiment and investment flows towards Turkey.