The lira weakened against the dollar for the first time in three days on concern higher energy costs will widen Turkey’s trade deficit and after the U.S. currency strengthened following the completion of the Greek debt-swap deal. The lira depreciated for the first time in three days, down 0.4 percent to 1.7826 as of 12:35 p.m. in Istanbul. The dollar gained 0.4 percent against the euro to 1.3226, also for the first time in three days. Yields (BENCH) on the benchmark two-year bonds increased, up four basis point to 9.19 percent. Oil rose this year on concern sanctions against Turkey’s neighbor Iran will lead to military conflict in the Middle East, where more than half the world’s crude reserves are located. Oil futures climbed as much as 0.7 percent, poised for the fourth weekly gain in five. Turkey’s energy bill would reach $65 billion if oil prices remain at their current levels, Economy MinisterZafer Caglayan said in Istanbul March 7, up from $54 billion in 2011. “The increase in oil prices is negative for the lira,� Burcin Metin, chief currency trader at ING Bank AS in Istanbul, said in e-mailed comments. Turkey’s current-account deficit narrowed in the last two months of 2011 after surging to a record $78.6 billion in October. It is still about 10 percent of gross domestic product, the second-highest in the world after the U.S. The country is dependent on imports for almost all of its energy requirements. Employers probably took on more than 200,000 workers in February for a third straight month, indicating an improving labor market will support the U.S. expansion, economists said before a report today. To contact the reporter on this story: Selcuk Gokoluk in Istanbul at sgokoluk@bloomberg.net To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

Source