TODAY’S ZAMAN – Jobless rate at 3-year peak, lira dives to 11-month low

Jobless rate at 3-year peak, lira dives to 11-month lowTurkeyand#39s unemployment rate rose to 10.5 percent in September compared with 10.

1 percent in the previous month, the highest since February 2011, government data said on Monday, sending the lira to new lows against the US dollarThe lira fell to an 11-month low against the US dollar, trading at 234, its lowest since Jan. 27 of this year, underperforming emerging market peers.

The Turkish Statistics Institute (TurkStat) said on Monday that Turkeyand#39s non-agricultural unemployment rate surged to 12.7 percent in September from 11.

3 percent a year ago. The countryand#39s youth jobless rate also reached an alarming level of 19.

2 percent in September, the government data revealed. The surge in non-agricultural and youth jobless rates send worrying signals regarding the jobless figures in coming months, observers warned on Monday.

The Organization for Economic Cooperation and Development (OECD) earlier this year said it expects unemployment in Turkey to reach 98 percent in 2014, 04 percent above the governmentand#39s unemployment estimate.Mondayand#39s figures show that the agriculture industry lost 190,000 jobs in September over a year ago, while the service sector lost 13,000, manufacturing gained 49,000 and construction gained 11,000.

Total job loss in this period was 144,000. The lira sank following the unemployment data early on Monday to trade at 2314 per US dollar Maintaining its freefall later on Monday, the Turkish currency fell to as low as 234.

The liraand#39s fall came after President Recep Tayyip ErdoIan lashed out at EU criticism over the detention of opposition journalists and signaled more raids could follow.The lira has fallen 5 percent this month against the dollar, the third-biggest depreciation among emerging markets in Europe, Africa and the Middle East, Bloomberg reported on Monday.

The two-year benchmark yield climbed for a third trading day on Monday by 23 points to 851 percent.Observers said Sundayand#39s government-sponsored police raid on Turkeyand#39s best-selling daily, Zaman, has had a negative impact on markets, especially the lira with investors flocking to sell the currency.

In response to media raids and detentions across Turkey on Sunday, EU and the US called on Turkish authorities to protect media freedom and other democratic values. Police on Sunday detained 24 people, including senior journalists, prompting the EU and the United States to raise questions about Turkeyand#39s press freedom record.

The lira has already been under pressure, like other emerging market assets, amid expectations that the US Federal Reserve will begin raising interest rates in 2015. andquotThis could prove to be a key market test for Turkey, coming at a particularly difficult time for emerging markets as they try to cope with the sharp adjustment in oil prices and the prospect of Fed tightening, eventually, in 2015,andquot said Timothy Ash, head of emerging market research for Standard Bank.

SOURCE: Today’s Zaman