Dollar at 1.5 month high on Iraqi fears

ISTANBUL

The dollar surpassed the 2.14 level for the first time since April 24. AP Photo

Growing fears over the crisis in Iraq sent the dollar/Turkish Lira ratio to its highest in 1.5 months June 16, as investors’ worries rise that Turkey may be dragged into the turmoil in Iraq, as Islamist militants continue advancing.

The dollar surpassed the 2.14 level for the first time since April 24, as 80 Turkish nationals, who were kidnapped by the Islamic State of Iraq and the Levant (ISIL), are still being held hostage, fueling fears over risks in Turkey.

The dollar/lira ratio, which was below the 2.08 level a week ago, prior to ISIL seizing Mosul during the late hours of June 9, touched 2.1439 in the morning trade, only to drop slightly.

The northern town of Telafar became the latest to fall to the militants, who have already captured a vast area of territory including Iraq’s second-largest city, Mosul.

As the militants keep extending their control in the country, global markets’ fears for deeper and bloodier clashes escalate.

The uncertainty fuelled by the insurgents has sent traders into safer assets.

Some 49 members of Turkey’s Mosul Consulate and 31 truck drivers were kidnapped by ISIL after they seized Mosul late June 9. One of the drivers managed to escape over the weekend.