World Bulletin / News Desk
The lira slipped 10 percent in the past week and posted its biggest loss against the dollar among emerging currencies.
"Turkey can benefit from a weaker currency because it would help its exports," Mayra Rodriguez Valladares, the managing principal of New York-based financial consulting and research firm MRV Associates, said.
"If you are trying to sell Turkish manufactured goods, that's great for exporters," she added.
DailyFX Senior Currency Strategist Christopher Vecchio said a weaker lira would help increase the competitiveness of Turkish exporters.
"In the near-term, weakness in the lira may need to persist in order to keep Turkish exporters competitive," he added.
The dollar-lira exchange rate reached a record 3.94 Wednesday, but fell to 3.74 Thursday after the Turkish Central Bank cancelled its usual weekly repo auction.
Although the intervention helped the lira Thursday, the central bank could run out of ammunition.
"It's very difficult for a central bank to protect its own currency," Rodriguez Valladares said. "We are talking about foreign exchange markets that are over $5 trillion.
"I know the central bank is very concerned about what they call currency speculators, but it's very difficult to control them."
Turkey's internal issues and the bank's limited set of tools are not the only reason for the weak lira against a strengthening dollar.