The Turkish lira has been the best performing emerging market currency so far in 2021, Robin Brooks, the chief economist at the US-based Institute of International Finance said on Wednesday.

"Lira outperformance stems primarily from the policy shift that took place in November 2020 and is ongoing," Brooks said on Twitter.

He noted that the outperformance is especially remarkable given the current valuation of the South African rand or the Brazilian real, which are down a lot.

The Turkish Central Bank’s monetary and exchange rate policies for 2021 are being welcomed by economists, who said the bank's anti-inflationary narrative gave positive messages to the market, showing a determined return to orthodox policies.

According to Timothy Ash, a senior emerging market strategist at the London-based BlueBay Asset Management, the Central Bank has "a decent" new governor, who he said is committed to an orthodox and credible monetary policy.

"[Naci] Agbal is key to the market turnaround," he said on Twitter.

In his first news conference, Agbal, who was appointed the Central Bank governor on Nov. 7 last year, said the risk of upward inflation will require a tight and decisive monetary policy stance in 2021, adding that it will be tightened if needed.

Over the course of the last year, starting with a rate of 12%, the bank raised its benchmark policy rate a total of 500 basis points./aa