Lyra played in transit – Newspaper Kommersant No. 53 (7498) of 03/29/2023

The volume of exchange trades in the Turkish lira confidently overtook the Kazakhstani tenge. The top three (yuan, dollar, euro) are still far away, but daily volumes already exceed 2 billion rubles. The activity of market participants increased against the background of information about the partial restoration of the transit of goods to the Russian Federation through Turkey and its tightening by Kazakhstan.

For the third day in a row, the volume of trading in the Turkish lira on the Moscow Exchange exceeded the milestone of 2 billion rubles: on March 28, with delivery “tomorrow”, they amounted to 2.07 billion rubles. This is comparable to the previous day’s result, although 21% lower than last Friday’s record value. In just three days, the volume of trading with the Turkish lira amounted to 6.9 billion rubles, and according to this indicator, it came in fourth place among foreign currencies traded on the Moscow Exchange.

As a result, the lira displaced the Kazakhstani tenge to fifth place, the volume of trading with which, following the results of three days, amounted to 4.5 billion rubles. However, it is still far from the indicators of the top three: the volume of trading in euro and dollar is tens of billions of rubles, and in yuan it is already steadily exceeding 100 billion rubles. in a day.

The Turkish lira, along with the yuan, Kazakh tenge, Belarusian ruble, Hong Kong dollar, belongs to the so-called currencies of friendly countries, but until recently it was not particularly popular with market participants, despite active trade between Russia and Turkey. The average daily trading volume of the lira in the fourth quarter of 2022 was less than 100 million rubles, almost seven times less than the trading volume of the Kazakh tenge (660 million rubles).

Trade turnover with Turkey more than doubled over the year, to almost $70 billion, while with Kazakhstan, by $2 billion, to $26 billion. 80% against the US dollar.

Several events could contribute to the increase in the activity of the lira at once, market participants note. Firstly, this is the effect of deferred payments against the backdrop of the recent blocking of transit flows of imports to the Russian Federation through Turkey (see Kommersant on March 10). “As the actions of the Turkish side are understood, payments begin to recover and compensate for the decline in the previous few weeks,” says Vladimir Evstifeev, head of the analytical department of Zenit Bank.

Secondly, Kazakhstan, on the contrary, intends to limit parallel imports to the Russian Federation (see Kommersant of March 28). This move could force companies to reconsider their logistics in favor of Turkey. “As an additional factor, it is worth highlighting the extension of the grain deal, which may require the use of the lira in the export of agricultural products and fertilizers from the Russian Federation,” Mr. Evstifeev notes.

However, the small size of the average transaction (about 100 thousand rubles) indicates the speculative activity of small investors. Oleg Syrovatkin, Leading Analyst of the Global Research Department at Otkritie Investments, notes that in March (especially over the last couple of weeks), the volatility of one- and three-month options on USDTRY has increased sharply. “This suggests that market participants are waiting for large-scale movements in the Turkish currency in the near and medium term. Including in connection with the approaching presidential elections in Turkey,” he notes.

At the same time, the interviewed analysts expect further growth of activity in exchange trading in the lira against the backdrop of the strategic course of Russia and Turkey to switch to national currencies in bilateral trade. “The plans to turn Turkey into a gas hub with the subsequent re-export of Russian gas to Europe will also contribute to an increase in the volume of settlements in national currencies. The factor in the increase in turnover in liras is the relocation of some Russians to Turkey due to geopolitics,” said Mikhail Vasiliev, chief analyst at Sovcombank. According to Egor Zhilnikov, chief analyst at PSB, a surge of interest should also be expected during the holidays, as integration is also taking place in the tourism sector.

The main obstacle to the transition to mutual settlements in national currencies is a small number of counterparty banks from Turkey, market participants point out. It is “restrained by the adaptation of banks to the sanctions profile of Russia,” notes Yegor Zhilnikov. As Mr. Evstifeev points out, “there is no growth in activity in other alternative currencies, except for the lira and the yuan, since there is no base in the form of increasing exports and imports with the relevant countries.”

Vitaly Gaidaev