Turkish exporters could see benefit in stronger euro: Expert
Agencies
Turkish exporters see the rise in the euro/U.S. dollar exchange rate as a potentially beneficial development, an expert opined recently, while the uncertainties over the independence of the Federal Reserve (Fed) continued to fuel concerns.
U.S. President Donald Trump is reportedly considering selecting a new name to chair the Fed in September or October. The Fed's likelihood of making three rate cuts by the end of the year increased, causing the euro/U.S. dollar exchange rate to rise to 1.1745 this week, a nearly four-year high.
The decline in the U.S. dollar showed that investors responded to Trump's decisions by selling their dollar assets, putting downward pressure on the U.S. Dollar Index, which fell to 97.076 on Thursday, its lowest since March 2022.
Tonguç Erbaş, general manager of Türkiye-based financial services firm Ahlatci Portföy, told Anadolu Agency (AA) on Friday that the rise in the exchange rate has been positive for Turkish exporters, and the European Central Bank (ECB)'s tight monetary stance to bring down the bloc's inflation to 2% also contributed to the rise.
Erbaş stated that the ECB is gradually easing its policy to bring stability to the EU economy, while concerns over tariffs are largely limited, boosting market confidence. Meanwhile, the Fed remains cautious amid debates that Trump could likely install a 'shadow chair' to the Fed.
'The rise in the euro/U.S. dollar exchange may have been positive for Turkish exporters because half of Türkiye's exports go to Europe, but most of our imports are dollar-based,' he said.
'The rise in the exchange rate is allowing euro-based revenue to increase when converted to Turkish lira,' he added.
Erbaş noted that the Turkish industrial sector in particular could benefit from the exchange rate, but the exchange rate risk on the import side needs to be monitored closely.
Türkiye's exports totaled $110.9 billion in January-May this year, 39% of which were to the EU, up 7.5% versus the same period last year, according to the data from Turkish Exporters' Assembly (TIM).
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Al Jazeera
5 hours ago
- Al Jazeera
Tariffs 101: Why women's products cost more
'Women have always been paying more for things we just never knew about it.' Did you know that women's clothing and personal care products are often priced higher than men's? It's been that way for years and there's even a name for it. Pink Tax. Now with Trump implementing widespread tariffs, how will this impact women's goods and jobs? This week on Now You Know, we talk to Prachi Agarwal, a research fellow at the International Economic Development Group at ODI Global. She focuses on trade policy and women in trade, explaining how tariffs work and why they disproportionately impact women.
Qatar Tribune
13 hours ago
- Qatar Tribune
UK-US deal for lower car and aerospace duties takes effect
Agencies A trade deal cutting tariffs on British exports of automobiles and aerospace equipment to the United States takes effect Monday, as the two sides continue to negotiate over steel duties. 'From today, British car and aerospace manufacturers will benefit from major tariff reductions when exporting to the US, saving thousands of jobs,' the UK Department of Trade said in a statement Monday. London and Washington reached an agreement in May to cut US tariffs on cars from 27.5 percent to 10 percent, with a limit of 100,000 vehicles a year. It also fully eliminated a 10-percent tariff on goods such as engines and aircraft parts. 'Our historic trade deal with the United States delivers for British businesses and protects UK jobs,' Prime Minister Keir Starmer said in the same statement. 'From today, our world-class automotive and aerospace industries will see tariffs slashed, safeguarding key industries that are vital to our economy.' In return, Britain agreed to further open its market to US ethanol and beef. That has raised concerns in the chemical industry and among British farmers, even though the meat would still have to meet UK food safety standards. London is still negotiating for lower tariffs for its steel and aluminum exports to the United States, which has raised its levies to 25 percent. 'We will continue go further and make progress towards zero percent tariffs on core steel products,' the trade department said in the statement. Meanwhile, China will maintain duties on certain steel products from the European Union, the United Kingdom, South Korea and Indonesia, its commerce ministry said Monday, as overcapacity concerns drive global trade turbulence. The duties on stainless steel billets and hot-rolled plates, first levied by Beijing in 2019, range from 20.2 percent for Indonesian imports to 43 percent for those from the EU. China's commerce ministry said that an internal investigation found the potential termination of the anti-dumping duties could still cause 'damage' to the domestic stainless steel industry. Authorities will therefore continue to impose duties on products from the three countries and the European bloc 'for a period of five years starting from July 1', the ministry said in a statement. China, the world's largest steel producer, first took the measures in response to tariffs imposed on it by the United States during Donald Trump's first presidential term. The US tariffs were motivated by fears in Washington and among its allies that unfair industrial policies in China had led to a global glut of cheap exports, threatening to undercut local producers. Since returning to office in January, Trump has sent the world economy into a tailspin with a tariff blitz that has hit Chinese exports particularly hard. Trade tensions between the world's top two economies remain high despite China and the United States reaching a temporary truce to the tariff war.
Qatar Tribune
13 hours ago
- Qatar Tribune
Turkey's trade deficit hits $6.65 billion in May
Agencies Turkey's foreign trade deficit stood at nearly $6.65 billion in May, official data from the Turkish Statistical Institute (TurkStat) revealed on country's exports totaled $24.82 billion in the month, up 2.6%, while imports amounted to $31.46 billion, up 2.7%, TurkStat said. Excluding energy and non-monetary gold, the foreign trade deficit was $1.89 billion in the month. In May, the ratios of the manufacturing industries products sector, agriculture, forestry and fishing sector, and the mining and quarrying sector in total exports were 95%, 3%, and 1.4%, respectively. High-tech's share in the manufacturing sector rose 7% to 4%, and medium-high tech's share increased 10.8% to 38.9% year-over-year in top destination countries for Turkish exports were Germany, with $2.1 billion, followed by the U.K., with $1.52 billion, and the U.S., with $1.51 billion, the data was the top source of imports to Turkey with $4.31 billion, followed by Russia with $3.26 billion and Germany with $2.69 billion. In January through May, the country's exports totaled $110.9 billion, up 3.4%, and imports were at $152.16 billion, up 5.8%.The foreign trade deficit for the five months was $41.25 billion, representing a 12.7% increase compared to January-May 2024.
