April 6 Reuters Turkeys lira dipped on Tuesday as annual inflation neared twoyear highs, while an index of emergingmarket currencies rose to a twoweek high as pressure from the dollar and U.S. Treasury yields appeared to ease.

The lira fell as much as 0.7 to the dollar after marking large swings over the past few sessions.

Data on Monday showed annual inflation in March climbed to above 16 its highest since mid2019, underlining continued pressure on the central bank to meet its ambitious target of 5.

Former central bank Governor Naci Agbals ouster last month, after only four months in office, had seen the lira plummet to record lows.

President Tayyip Erdogan has abruptly fired four bank chiefs in less than two years, hurting monetary credibility and contributing to the currencys longterm decline, which in turn has driven up overall inflation via imports.

New Central Bank of Turkey Governor Şahap Kavacıoğlu saying that rate cuts should not be taken for granted does not qualify as such a positive. If he refused to implement Erdogans monetary policy vision, this would not imply a stronger lira it would only imply that he would not be around for very long, said Tatha Ghose, FX and EM Analyst at Commerzbank.

Whatever actually comes to pass, for now the FX market is very likely to think in this direction.

Other emergingmarket currencies rose on Tuesday, as the dollar and U.S. Treasury yields retreated from recent gains. The MSCIs index of EM currencies rose 0.2 to a…