"Turkey is in the midst of a true currency crisis and is losing the luxury of choice" as the "lira is capitulating, helping inflation soar and rapidly worsening Turkey’s external debt situation."

The lira has already fallen more than 10% this month versus the euro-dollar basket. Brent crude is up 19% this month in lira terms. As a major energy importer, such a pace is unsustainable for the economy.

A currency-fueled inflation- spiral -- April CPI at 10.85% year-on-year and PPI at 16.37% even before the latest lira losses — is leading to a massive and rapid erosion of household wealth.