ISTANBUL: The lira dipped for the seventh straight session on Friday and a key CDS measure of risk for Turkish assets earlier touched its highest since 2008, as pressure mounted on authorities to stabilise markets amid a global flight to safety.

The lira has shed nearly 5% against the dollar since last Wednesday and was at its lowest since December when it was gripped by a currency crisis.

Turkey’s currency weakened as far as 15.4675 against the US currency and stood at 15.458 at 0801 GMT. It has lost some 15% of its value this year, on top of a 44% slide in 2021.

The slump has left traders predicting that authorities are targeting a new level, as weak as 15.5 to the dollar, in a months-long effort to stabilise the exchange rate using its depleted reserves together with other measures.

The central bank, under pressure from President Tayyip Erdogan, is unwilling to raise its key interest rate from 14% despite inflation having soared to 70%. In response to the unorthodox monetary policy settings, Turkey’s 5-year credit default swaps (CDS), the cost of insuring against default, jumped above 700 points on Thursday, its highest since 2008 according to Refinitiv data.

CDS have jumped by more than 70 points over the last week, raising the Treasury’s borrowing costs, though they dipped back below 700 on Friday.

Emerging markets have suffered since last week when the US Federal Reserve hiked rates to head off inflation, drawing funds away from riskier assets.