TURKEY: Imamoglu Arrest Risks Social Unrest Despite Ban On Protests
REPOST: Typo in second paragraph fixed. The arrest of Istanbul mayor and key opposition figure Ekrem Imamoglu on charges of being a "criminal organisation leader suspect" has roiled domestic and regional financial markets (see 'FOREX: EUR Undermined by Jolt in Turkish Political Uncertainty', 0926GMT, 'TURKEY: Why is Turkish Political Uncertainty Impacting Wider Markets?', 0909GMT, and 'TRY: Markets Roiled by Arrest of Opposition Leader, TRY Drops as Much as 10%, 0812GMT). As has been noted, Imamoglu is seen as the most significant political challenge to President Recep Tayyip Erdogan, with the Istanbul mayor due to have been confirmed as the presidential candidate for the main opposition centre-left Republican People's Party (CHP) on 23 March.
- Turkish authorities have already taken the preventative step of closing all roads and metro stations around Taksim Square in Istanbul, which has been the site of mass protests over the years. All demonstrations have been banned across the city from 19-23 March. Restricted access to social media including X, TikTok, YouTube and Instagram has also been reported.
- It remains to be seen if such actions prove sufficient in dissuading opposition figures from taking to the streets. With Imamoglu, as well as hundreds of others including politicians, journalists, and business figures arrested on corruption charges, this is the most severe sign of a gov't crackdown since the response to the failed military coup against the Erdogan gov't in 2016.
- According to the constitution, Erdogan is term-limited and therefore cannot run in the 2028 election. However, there is speculation a snap election could be called before then. Under Art. 106 of the Turkish Constitution, if the presidential office becomes vacant, i.e. by calling a snap election, then the uncompleted term does not 'count', which would allow Erdogan another electoral run.
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EURIBOR: EURIBOR FIX - 17/02/25
EURIBOR FIX - EMMI/Bloomberg.
- EUR001W 2.6390 0.0260
- EUR001M 2.6160 0.0120
- EUR003M 2.5100 -0.0120
- EUR006M 2.4890 -0.0250
- EUR012M 2.4240 -0.0140
EUROPEAN DATA: Larger Than Expected Trade Surplus On Import Weakness
- The Eurozone trade surplus printed close to consensus in December, at a seasonally adjusted E14.6bn (cons E14.5bn) after an upward revised E13.3bn (originally E12.9bn).
- The larger surplus was for the ‘wrong’ reasons, coming as the decline in imports (-0.8% M/M) outstripped that of exports (-0.2% M/M).
- This story was exaggerated for the EU as a whole, with a surplus widening from E10.1bn to E12.9bn (sa) as imports fell -1.2% M/M vs exports 0.1% M/M.
- Turning to the broader EU nsa data, extra-EU export growth stood at 3.7% Y/Y vs 3.9% Y/Y for extra-EU imports, whilst intra-EU trade was more subdued at just 1.6% Y/Y.
- One of the fastest growing areas of exports was for chemicals & related products (14.3% Y/Y), as we’ve noted one of the more vulnerable areas to US tariffs considering its magnitude within EU-US trade.
- By country, trade with the US was mixed the month ahead of Trump’s inauguration, with overall exports rising 5.6% Y/Y vs overall import growth of -10.8% Y/Y.
COMMODITIES: WTI Futures Remain Below 50-Day EMA
WTI futures have pulled back from last week’s high and price has again traded below the 50-day EMA - at $72.08. Attention is on $70.43, the Feb 6 low. It has been pierced, a clear break would undermine a bullish theme and confirm a breach of the 50-day EMA. This would strengthen a bearish threat and open $68.05, the Dec 20 ‘24 low. Key S/T resistance has been defined at $75.18. A move above this level is required to reinstate a bull theme. A bull cycle in Gold remains in play and the yellow metal continues to trade closer to its latest highs. Recent gains once again confirm a resumption of the uptrend and maintain the bullish price sequence of higher highs and higher lows. Moving average studies are in a bull mode position too, highlighting a dominant uptrend. Sights are on the $2962.2, a Fibonacci projection. The first key support to watch is $2826.5, the 20-day EMA.
- WTI Crude up $0.12 or +0.17% at $70.86
- Natural Gas down $0.09 or -2.42% at $3.637
- Gold spot up $20.92 or +0.73% at $2903.75
- Copper down $3.3 or -0.7% at $468
- Silver up $0.35 or +1.08% at $32.4489
- Platinum up $3.97 or +0.4% at $988.13
