(MENAFN- Asia Times)
Iran's rial, Russia's ruble and Turkey's lira are disintegrating despite a rush into risk elsewhere in world markets. Stocks and commodity prices are jumping after Chinese leader Xi Jinping's statesmanlike speech last night, but the Unholy Three are faring badly.
Western countries engineered a collapse of Russia's ruble (which usually trades with oil prices) by imposing sanctions that prevent targeted companies like Rusal from obtaining foreign exchange. Rusal may miss a tiny (US$13 million) bond payment this week simply because the sanctions deny it access to the financial system. Russia's ruble has plunged as a result, from 58 to the dollar last Friday to 63 this morning.
Iran's rial fetches 60,000 to the dollar on the black market, up from 35,000 at the end of 2016. Iran's government has declared that it will hold the line at Rial 42,000 to the dollar, but state-sponsored foreign exchange dealers have stopped selling dollars.
Turkey's embattled lira hit a new low of around 4.10 to the US dollar shortly after 8:00 am. Turkey suffers from 10% inflation driven by an enormous internal credit bubble, a current account deficit of nearly 6% of GDP, and a US$220 billion corporate debt load in foreign currency.
Is it a coincidence that these are the three countries whose leaders met last week in Istanbul to carve up Syria? Evidently the Western powers still have the capacity to make life miserable for aggressive regional powers who also need to borrow heavily from Western financial markets.
The daily<> Must-reads from across Asia - directly to your inbox <> <> <> <> Asia Unhedged currency markets Russia Iran Turkey Syria Turkish lira ruble Comments
MENAFN1004201801590000ID1096718134
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.