Dollar/TL Holds at 47.60 Amid Fed Dovish Signals and Geopolitical Risks

Global liquidity conditions are being reshaped by the weakening in US employment data, and as geopolitical risks push the risk premium higher, USD/TRY is undergoing a consolidation process at the critical 47.60 level.

ADP Data and the Fed's Rate Path

Private sector employment, one of the most critical data points determining the Federal Reserve's (Fed) policy stance, came in below market expectations in July with an increase of 44,000 people. This data reinforced expectations that the Fed's "hawkish" stance is softening, deeply impacting pricing in money markets.

■The probability of a 25 basis point rate hike in the September meeting retreated to 55%.

■Expectations for a rate hike in the October meeting were pulled down to 80%.

■Minneapolis Fed President Neel Kashkari advocated for a "gradual" increase in interest rates, supporting policy normalization.

Geopolitical Risks and Trump's Diplomacy Move

Investors' focus is not solely on macroeconomic data but also on developments in the Middle East. While US President Donald Trump's signals regarding diplomacy with Iran raise hopes for a reduction in regional tensions, they do not fully release risk appetite.

■Trump stated that talks with Iran are progressing "very well" and the picture will become clear within 48 hours.

■Statements that the Strait of Hormuz will open "very soon" are alleviating energy supply concerns.

■It was emphasized that "use of force" is still on the table in case diplomacy fails.

Smart money flows observed in market depth indicate that short-term long positions are leaning towards profit-taking following the weak ADP print. However, the lack of strong selling pressure below the 47.60 level suggests that local investor demand for the dollar remains alive in intermediary institution distributions (AKD). Volumes coming from dark pools are currently reacting cautiously to the geopolitical news flow.