Turkish lira falls after government reports first coronavirus case

Turkey’s lira declined on Wednesday after the government reported the country’s first case of the coronavirus.

The lira weakened 0.3 percent to 6.17 per dollar at 2:23 p.m. local time in Istanbul.

Turkish ministers gathered for an emergency meeting in the capital Ankara after Health Minister Fahrettin Koca announced late on Tuesday that a man travelling to Turkey from Europe had been infected by the virus.

The Turkish lira has come under renewed pressure this year after the central bank slashed interest rates to help the economy recover from a currency crisis in 2018 and Turkey’s army clashed with forces loyal to President Bashar Assad in the Syrian enclave of Idlib. Any spread of the virus could reduce much-needed foreign currency revenues from tourism, shut down businesses and cut spending as consumers invest in safe-haven currencies such as the dollar.

Tourism companies are calling for delays to tax payments and for loans from state-run banks to help deal with the impact of the virus on their operations. The industry is already struggling financially and cancellations of bookings have reached serious proportions, the firms said in a meeting on Tuesday.

Revenue from tourism jumped 17 percent to $34.5 billion last year, increasing the flow of foreign currency into the economy and helping to slow the lira’s depreciation. Still, the lira dropped 11 percent last year following a slide of 28 percent in 2018. 

“No virus is stronger than the measures we are taking,” President Recep Tayyip Erdoğan told members of his ruling party at parliament on Wednesday in a televised address.

Turkey’s government says it has taken immediate steps to contain the virus, such as stopping flights to and from Iran and testing visitors at airports and ports. Hospitals are well prepared to treat any future cases and the country has ample supplies of medicines and masks, it says.