(Bloomberg) -- The U.S. sanctions that lira traders have been dreading for months will probably be announced in the coming days, but the possibility that their impact on Turkey’s economy will be minimal may ward off a rout.

“Limited U.S. sanctions are expected and, near term, would not affect perception of risk in Turkey as much the lack of credibility in interest rate policy,” said Dubai-based Hasnain Malik, the head of equity strategy at Tellimer, an investment bank focused on emerging markets. “Long term, Turkey remains a key ally of the U.S., particularly when the U.S. is positioned against Iran and Russia.”

Traders probably won’t react as negatively as they did to central bank Governor Murat Cetinkaya’s ouster unless the sanctions are unexpectedly punitive, said Malik. U.S. President Donald Trump hinted last month that the punishment could be mild.

Turkey on Friday began receiving parts for the Russian-made S-400 missile system, which Washington has said puts at risk the Pentagon’s costliest weapons program, the F-35 fighter jet built by Lockheed Martin Corp. That prompted U.S. officials to decide on a package of penalties, to be announced once the president has given his approval, according to people familiar with the matter.

The lira, the world’s most volatile currency, has declined more than 7% so far this year, the biggest loss among emerging-market peers after Argentina’s peso.

To contact the reporter on this story: Paul Wallace in Lagos at pwallace25@bloomberg.net

To contact the editors responsible for this story: Dana El Baltaji at delbaltaji@bloomberg.net, Stanley James

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