10-year Treasury yields have wiped out the move higher after the Fed decision not to extend the SLR exemption at the end of last week
USD/TRY is seeing gains trimmed to 7.70, just below 7%, after having opened with a gap higher of 15% to start the new week.
The lira collapsed amid thin liquidity conditions as Turkish president Erdogan fired central bank governor Agbal after the latter hiked rates by 200 bps on Thursday last week.
As the lira exudes some "calm" ahead of European trading, this puts some of the spotlight back on the bond market again.
10-year Treasury yields have already fallen back to the lows seen last Friday before the Fed's decision to not extend the SLR exemption.
That might help risk assets breathe a sigh of relief in the session ahead after the jittery start to the new week earlier. If anything, expect the lira to continue to be volatile and that might still cause a ruckus. But expect the broader market focus to slowly switch back to yields and the bond market as time passes this week.
