The volatility of the Turkish lira and the Japanese yen currency pair is quite high. If to take into account that the Japanese economy and, accordingly, the yen are quite stable, then the behavior on the lira market is quite unpredictable and depends on many economic and political factors occurring in Turkey.
If taken the fact that Japan raised its economy from the ruins of World War II, then Singapore, until the middle of 1965, was still a part of the Federation of Malaysia. After gaining independence, the country was in an extremely distressed situation, which is characterized by the fact that they even had to buy fresh water and building sand.
The history of the Turkish lira cannot be called prolonged. It was put into circulation during the reforms of the head of Turkey, Kemal Ataturk in 1923. The currency replaced its predecessor, the Ottoman lira. For quite some time, the Turkish lira depended on the British pound, and subsequently on the French franc.
Immediately after the Second World War, the rate of the Turkish lira to the American dollar was in the value of 1 to 2.8, for a one dollar bill they gave almost three liras. And this situation continued until 1960, when there was a devaluation of the national currency of Turkey and for one US dollar they began to give 9 Turkish liras. In the future, much worse times awaited the Turkish lira. A serious depreciation occurred, and by the beginning of the 21st century, one and a half million Turkish liras were already paid for the dollar. Moreover, TRY received the unofficial name of the cheapest currency in the world.
The Central Bank of the country in 2005 took a series of anti-inflationary measures. As a result of the denomination, the “new turkish lira” was put into circulation. The course of the new lira was equal to 1,000,000 to the old one. In 2009, the word “new” disappeared from the name, and the exchange rate was stabilized.
Today, the International Monetary Fund considers Turkey an emerging economy. Turkey’s accession to the EU is not yet considered. The main opponents of this step are Germany and France. The reasons are the instability of the political situation in the country. The United States is threatening sanctions due to Turkey’s military cooperation with Russia. All this prevents the Turkish lira from strengthening its position.
The Japanese yen is a much more stable currency. In the second half of the 20th century, the country managed to make a big economic leap, which allowed the Japanese yen to take a firm position in the global currency market. Moreover, JPY is considered the second most important reserve currency of the world after the US dollar. The issuer of JPY is the Central Bank of Japan. The production of manufactured goods is of great importance for the country. Many products are being exported, which is why the world is interested in buying the Japanese yen.
The Japanese yen in currency pairs is most often a quoted currency, as in the case of TRY/JPY. Thus, the positive news for the yen associated with any economic events lead to a decrease in the Turkish lira paired with the yen, and vice versa. If you look at the chart, you can see the high volatility of the pair, especially in the short-term periods. In the long term, a long downtrend is noteworthy.
Both market newcomers, and professional traders can pay attention to this couple. But still, high volatility implies a certain risk, so it is better for beginners to choose a more stable currency pair to start with. Both technical and fundamental analysis should be used. Turkey is an active player influencing the countries of the Middle East. Often, some decisions of the country's leadership have a direct impact on the Turkish lira.