Lira may outperform its peers, analyst says

Bloomberg

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Danske targets the Turkish currency at 5.65 against the rand in three months. The lira traded at 5.39 per rand at 3:20 p.m. in Istanbul on Friday. It was at 1.5525 against the U.S. dollar, the highest level since early January.

The greenback lost 4.3 percent against the Turkish currency since April 1, as risk aversion eased on speculation the worst of the global crisis is over and that the appointment on May 1 of Ali Babacan as deputy prime minister responsible for the economy will hasten a loan agreement with the International Monetary Fund, or IMF.

"We see these appointments as generally positive for Turkey," Lars Tranberg Rasmussen, senior analyst at Danske Bank in Copenhagen, said in a note last week.

The lira should also benefit from slowing inflation, which Danske forecast to ease to around 5 percent by the end of 2009, according to Rasmussen. Prices rose at an annual rate of 6.1 percent in April, the slowest since 1970.

The South African currency gained 13.3 percent this year against the dollar and was trading at around 0.119 dollars on Friday.