Fitch sees Turkey on the junk level. – tagesschau.de

status: 28.01.2017 11:46 PM

Turkish government bonds there are bad notes: The US rating Agency Fitch has downgraded the credit rating of the country down – and called for several reasons. Meanwhile, Standard &amp threatens; Poor’s, with a further reduction.

The US rating Agency Fitch has downgraded Turkey’s credit rating to junk level down. Thus, the Turkish state is rich bonds in all of the major credit rating agencies as risk. The credit rating had been lowered one notch to “BB+,” said Fitch. The Outlook for the Rating was stable. Thus, no further downgrade.

uncertainty due to political stability…

Fitch justified the downgrade with the uncertainty over the political stability and security of the country. The forthcoming constitutional referendum could policy is the control of the government to undermine it. After the coup attempt last summer, the emergency legislation is still in force.

…terrorist attacks weigh on tourism

in Addition, terrorist attacks would have more confidence in the consumers and the tourism sector burden. Fitch also refers to the strong decline of the Turkish currency, the Lira. Is at risk in Turkey due to the high foreign debt. Economic growth has slowed down in the second half of 2016. The downgrade by Fitch is expected to increase the price of the Debt by the Turkish government. The economic crisis in the country could intensify.

S&P threatens to lower downgrading

Meanwhile, the rating Agency Standard & Poor’s (S&amp threatens;P) of the Turkey with a downgrade of the credit rating deeper into the junk area. The Outlook was lowered to “negative” from “stable,” said S&P. The scope of the decision-makers in the fight against Inflation and the weakness of the Turkish Lira sank, it was said to the grounds. President Recep Tayyip Erdogan has repeatedly criticized the interest rate policy of the Central Bank. With the Note “BB” Turkish bonds as speculative investments.

The Turkish Lira had fallen several times in recent weeks to record lows. Economists hold significant interest-rate increases necessary to support the currency and to get a firm grip on Inflation. But Erdogan wants to keep interest rates low, with cheap loans to boost the economy. “Interest rate increases have a negative effect on the exchange rate and Inflation,” said Erdogan in his criticism.