REUTERS/Dado Ruvic/Illustration// File PhotoThe dollar was trading 12% higher on the lira at 8.100, but that was off an early peak of 8.4850 amidst speculation Turkish authorities would step in to stem the rout.The slide came after President Tayyip Erdogan stunned markets by changing Turkeys hawkish central bank guv with a critic of high interest rates.”Erdogans choice to fire Governor Agbal, who had actually sought to instil some price stability and perception of Bank self-reliance, now raises concern as to whether the new Governor will look to lower rates while still aim to fight greater inflation,” stated Rodrigo Catril, a senior FX strategist at NAB.After a preliminary wobble, belief appeared to stabilise and MSCIs broadest index of Asia-Pacific shares outside Japan was all however flat.Japans Nikkei fell 1.4%, not helped by talk Japanese retail financiers might face losses on big long positions in the high-yielding lira.Nasdaq futures bounced to be up 0.1%, while S&P 500 futures were off a minor 0.1%. Supporting the yen were concerns Japanese retail financiers that have constructed long lira positions, a popular trade for the yield-hungry sector, might be squeezed out and set off another round of lira selling.Still, analysts at Citi questioned that episode would lead to prevalent pressure on emerging markets, keeping in mind the last time the lira slid in 2020, there was little spillover.

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