Very Difficult for Lira to Find a Floor, Says StanChart's Devesh

The video discusses the challenges facing the Turkish lira, emphasizing the need for a coordinated policy response involving monetary, fiscal, and foreign policy. It highlights the contagion risks to the euro and the FX market, particularly focusing on European banks' exposure to Turkish assets. The discussion also covers the potential impact of corporate debt defaults in Turkey, which could lead to significant market instability, especially in the Balkans.

What combination of policies is suggested to stabilize the Turkish lira?

• Foreign policy and military intervention

• Fiscal policy and trade agreements

• Monetary, fiscal, and foreign policy

• Only monetary policy

What is the primary concern regarding the euro's decline in relation to the Turkish lira?

• The euro is declining due to Brexit.

• European banks' exposure to Turkish assets is a concern.

• The euro is unaffected by the Turkish lira.

• The euro's decline is due to internal European factors.

Which group is most at risk due to the Turkish lira's weakness?

• US investors

• Turkish government officials

• Turkish corporates with foreign currency debt

• European tourists

What potential consequence is highlighted for Turkish corporates with unhedged foreign currency borrowing?

• Systemic defaults and bankruptcies

• Increased profits

• Higher stock prices

• Improved credit ratings

What has been the percentage decline in the Turkish lira this year?

• 40-44%

• 20%

• 50%

• 30%