Investing.com - The Turkish lira rebounded against the dollar on Monday, as Turkey’s government regained control of the country in the wake of a failed coup attempt, while the safe haven yen retreated as market sentiment improved.
The dollar fell 2.71% against the lira to trade at 2.9318.
The dollar had jumped 4.73% against the lira by late trade on Friday after Turkey’s prime minister said there was a coup attempt under way. It was the largest one-day decline in the lira since October 2008.
The traditional safe haven yen was also lower, with USD/JPY advancing 0.86% to 105.78, not far from the three-week highs of 106.30 hit on Friday.
Demand for the dollar continued to be underpinned as upbeat U.S. data on retail sales and industrial output on Friday boosted the outlook for second quarter growth.
The Commerce Department reported that U.S. retail sales rose 0.6% in June, the third straight monthly increase and easily outstripping gains of 0.1% forecast by economists.
Another report showed that industrial production rose 0.6% last month, the biggest increase in eleven months.
The yen remained on the back foot, after falling more than 4% against the dollar last week amid mounting expectations for more aggressive monetary easing by Tokyo to spur growth and inflation.
Sterling was also higher, with GBP/USD climbing 0.52% to 1.3249.
The pound had fallen on Friday after the Bank of England’s chief economist said the bank is poised to ease monetary policy in August to counteract the negative economic shock from the Brexit vote.
The comments came a day after the BoE kept interest rates on hold, surprising many market watchers who had expected a rate cut.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, eased 0.09% to 96.61.
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