The Turkish lira found a floor on Tuesday after a historic 7.5 slump in the previous session following a central bank shakeup, while the Russian rouble hit a near sevenweek low on looming U.S. sanctions against Moscow.

The lira was up about 1 at 7.7192 versus the dollar after falling close to its record low of 8.58 in the previous session as President Tayyip Erdogan replaced a hawkish central bank governor with a critic of high interest rates.

Mondays decline erased most of the gains for the lira since November 2020, with investors fearing a reversal of recent interest rate hikes that had revived the currency amid concerns over Turkeys falling forex reserves and high inflation levels.

Greed and fear will remain the main shortterm drivers for investors in Turkey, said Yerlan Syzdykov, global head of emerging markets at Amundi, Europes largest asset manager with 1.7 trillion euro 2 trillion under management.

What will determine investors risk appetite in the long run is the assessment of the capacity of the new economic team to maintain macroeconomic stability, delivering a transparent framework for monetary and fiscal policy.

The broader MSCI index of emerging market currencies was flat by 0840 GMT as the dollar firmed ahead of testimonies from U.S. policymakers about their tolerance for a recent rise in bond yields.

The rouble was among the biggest decliners on the day, sliding 0.8 to its lowest since Feb. 5 as Russia braced for a new round of U.S. sanctions over…