The real value of the Turkish Lira hits a 3.5-year high

According to data published by the Central Bank of the Republic of Turkey (CBRT), the Consumer Price Index (CPI)-based real effective exchange rate index was calculated at 62.90 points in July. This marks the highest point since March 2021, when it reached 64.99.

The CPI-based real effective exchange rate index for June was revised from 61.90 points to 61.99 points.

The Producer Price Index (PPI)-based real effective exchange rate index rose by 0.3% in July, reaching 94.69 points. The previous month's index was revised from 94.30 points to 94.40 points.

The real effective exchange rate index based on emerging markets increased from 50.02 points to 50.79 points, while the index based on developed countries rose from 71.54 points to 72.54 points.

The nominal effective exchange rate is calculated as the weighted average value of the TL based on a basket of currencies from countries with significant trade volume with Turkey.

The increase in the real effective exchange rate indicates that the Turkish Lira has appreciated, meaning that the price of Turkish goods in terms of foreign goods has risen.