(Bloomberg) -- The lira pared losses after Turkey’s central bank said it would allow exporters to repay dollar-denominated loans in the local currency.

The measures come two days after an emergency rate hike and underscore policy makers’ efforts to stem the rot in the lira. Still, the lira was headed for its biggest weekly drop since the global financial crisis.

The lira has been one of the currencies hardest hit by an emerging-market sell-off this year amid concern the nation’s interest rates are too low given a current-account deficit and double-digit inflation.

“It has been decided that the repayments of rediscount credits for export and foreign exchange earning services that have been extended before 25 May 2018, which will be due by 31 July 2018, can be made in Turkish liras at an exchange rate of 4.2 for the USD, 4.9 for the Euro, and 5.6 for the GBP, provided that they are paid at maturity,” the central bank in Ankara said in a statement.

The lira traded 0.6 percent lower at 4.7362 per dollar after the central bank’s announcement. The lira has slumped more than 5 percent this week alone, headed for the biggest weekly decline since October 2008, when it sank almost 30 percent in four weeks.

“We do not think the central bank has regained its credibility,” said Daria Parkhomenko, an analyst at RBC Capital Markets in New York. “If the political pressure does not abate ahead of the presidential and parliamentary elections in June, this would continue to pose a downside risk to lira.”

(Adds central bank’s move, updates prices.)

To contact the reporters on this story: Ven Ram at vram1@bloomberg.net;Marton Eder in Budapest at meder4@bloomberg.net;Tugce Ozsoy in Istanbul at tozsoy1@bloomberg.net

To contact the editors responsible for this story: Ven Ram at vram1@bloomberg.net, Scott Hamilton

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