The Turkish lira has experienced significant fluctuations over the past five years, directly affecting inflation rates, product prices, and the export sector.

Turkish Lira Exchange Rate Against the US Dollar (2020-2025):

  • March 2020: 1 USD ≈ 6.5 TRY

  • March 2021: 1 USD ≈ 7.8 TRY

  • March 2022: 1 USD ≈ 14.8 TRY

  • March 2023: 1 USD ≈ 19.0 TRY

  • March 2024: 1 USD ≈ 30.0 TRY

  • March 2025: 1 USD ≈ 37.7 TRY

Impact of Exchange Rate Fluctuations on Inflation and Prices:

The depreciation of the lira has increased import costs, leading to a rise in the prices of both imported and domestic goods. This price surge has fueled inflation, which exceeded 20% during some periods. The rising cost of living has weakened consumers' purchasing power, intensifying economic and social pressures.

Effect on the Export Sector:

On the other hand, the lira's depreciation has had a positive effect on Turkish exports, making them more competitive in global markets due to lower dollar-based costs. This could increase foreign demand for Turkish products, boosting foreign currency earnings. However, exporting companies also face challenges, such as rising costs of imported raw materials and continuous exchange rate volatility.

Conclusion:

The Turkish lira's experience over the past five years highlights the deep impact of currency fluctuations on the local economy. While a weaker lira can boost exports, the negative effects on inflation and consumer prices necessitate balanced economic policies to ensure stability and protect consumers.