Turkey lets the lira slip

Turkey is allowing the lira to fall more quickly in an effort to reduce the risk of a more abrupt devaluation later, Bloomberg reported, citing people with direct knowledge of remarks by central bank Governor Fatih Karahan at investor meetings in Bangkok.

That is a policy choice worth separating from the usual market melodrama. A currency sliding under official tolerance is not the same thing as a currency spiraling out of control. The distinction, if Karahan’s message was reported accurately, is that the central bank appears to prefer a managed loss of value over a bigger one forced by pent-up pressure.

What the Bloomberg summary does not establish is how fast the lira is being allowed to weaken, what exchange-rate path officials consider acceptable, or what other tools the central bank may be using alongside that stance. Investors got the intention. The harder number, as usual, is the limit.