FX.co ★ Turkish Lira Holds at 41.9

In October 2025, the Turkish lira reached a new all-time low, trading at 41.9 per US dollar, thereby extending its decline for the year to approximately 18%. Since July 2023, the currency has experienced a steady and controlled depreciation. The Central Bank of Turkey has played an active role in the foreign exchange market to maintain strict oversight of the lira's fluctuations, while the government continues to follow a policy known as "real appreciation." Regarding monetary policy, the central bank reduced interest rates by 100 basis points in October, a move that had been anticipated. This reduction is the third consecutive rate cut and the smallest in the current cycle of easing, occurring amidst an acceleration in inflation—which rose for the first time in fifteen months—to 33.29% in September. On a different front, a Turkish court has dismissed a lawsuit that aimed to oust the leader of the main opposition party and annul its 2023 congress. This decision alleviates some of the pressure on President Erdogan's opposition and provides a measure of relief from the political instability that has heavily impacted Turkish markets this year.