Turkey's currency the lira hit a new record low on Tuesday as investors moved out of emerging markets amid the collapse of the Russian ruble and fretted over the impact of raids against Turkish opposition media. The lira hit a record low in value of 2.41 lira to the dollar, worse than Monday's record low in value of 2.39 lira to the dollar. Against the euro, the currency struck a low in value of 3.03 lira to the euro, breaking through the crucial 3.0 barrier.
The currency has now slumped past the lows seen in late January when the country was on the verge of a full scale currency crisis before the central bank intervened with an emergency rate hike. However in afternoon trading the currency staged a slight recovery to trade at levels close to its opening value. The lira was supported by a central bank announcement it would cover the foreign exchange needs of energy importing state-owned enterprises, reducing fears of their exposure to the current turbulence on emerging market currency exchanges.
"The foreign exchange needs of the energy importing state owned enterprises will be met directly" by the bank and the treasury, it said in a statement. In late afternoon trade, the lira was trading at 2.36 lira to the dollar, a slight improvement from its closing value on Monday. It was trading at 2.96 lira to the euro.
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