The Turkish lira had a downward run against the greenback in Monday’s trading sessions. The Turkish currency tumbled by over 1% which the forex market calls a “flash crash.”
The fall is caused by the Japanese investors cutting risk assets against the ongoing trade war between the US and China.
The USDTRY trading pair went up by 1.15% or 0.0664 points in sessions. The pair currently exchanges at ₺5.8170 compared against its previous close of ₺5.7589.
The USDTRY pair climbed to impressive levels of ₺5.7732 to ₺5.8495 in today’s trading. The greenback took advantage of the lira which opened its doors to a positive run.
The weakening Turkish currency also lost against other major currencies such as the Japanese Yen, Chinese Yuan, and Euro.
The JPYTRY exchange pair gained 1.04% or 0.00057 points in Monday’s sessions. The pair presently trades at ₺0.05515 against its last close of ₺0.05458. THE JPYTRY pair reached ranges between ₺0.05469 and ₺0.05556 in Asian trading.
The CNYTRY pair rose by 0.52% or 0.0042 points, trading for ₺0.8151 compared against from its previous close of ₺0.8110.
And the EURTRY climbed up by 0.87% or 0.0559 points in today’s trading. The pair currently trades at ₺6.4742 against its last close ₺6.4183.
Forex traders refer to the Turkish lira’s tumble as a “flash crash.” The main reason for its weakening is the intensifying trade tension between the United States and China.
Beijing just recently set its retaliatory tariffs targeting over $75 billion worth of American goods.
The Chinese government’s announcement triggered Washington. And just last Friday, Donald Trump announced a new round of fresh tariffs that target $550 billion worth of Chinese products
A similar record of a flash crash by the Turkish lira was set on January 3, 2019, after a global market sell-off.
After that, the lira has made a recovery and has gained in recent months. Forex traders are saying that the Turkish currency failed to hold on to its gains due to the pressure.