Turkey’s currency, the lira, has fallen by double digits (13 percent) against the dollar over the past six weeks. It is one of the worst casualties of the selloff in emerging markets. Prices were rising by 7.4 percent in the year to December and the political pressure to keep interest rates low remained constant. The central bank responded by raising its key rate from 4.5 percent to 10 percent.

India’s central bank also raised rates, but by a less extreme hike. The country increased its rates by 0.25 percent, but this was the third time in five months that it made this move. South Africa did the same the next day, increasing its rates by 0.5 percent. The three countries appear to be increasing their rates to keep inflation down and give their respective currencies a lift.

These moves are being made against the backdrop of a gradual increase in interest rates worldwide. The U.S. economy is gradually picking up steam, and the Federal Reserve is moderating its bond purchases. Yields on 10-year Treasury Bonds are still sitting at low rates; they are only paying out at 2.8 percent. This is still a full percentage point higher than nine months ago. At the Fed’s last meeting on January 29, it decided to decrease its monthly purchases by $10 billion, which is the same amount as last December.

Binary options traders should expect that long-term interest rates will continue to rise. They should keep a careful watch on the 10-year yields, too. If the Treasuries hit the three percent level, interest rates will likely increase by half-point increments, as opposed to a full percentage point at a time.