The Turkish lira rallied sharply Wednesday as the primary vulnerability in Turkey's economy, a large current-account deficit, narrowed.
The broad measure of Turkey's total international transactions registered a shortfall of $48.9 billion in 2012 against $77.2 billion a year earlier. The change was driven by an increase in exports, according to central bank data released Wednesday. The deficit was narrower than the market consensus of $50.5 billion.
The rally for the lira came as several other currencies in Europe also gained, including the Hungarian forint. Helping the forint was the successful issuance of Hungary's first bond in international markets since May 2011. Even so, broad economic weakness in the region continues, casting questions over future growth prospects.
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