Turkey Cut Deeper Into Junk by Fitch Citing Risks to Stability

(Bloomberg) -- Turkey’s long-term foreign-currency issuer default rating lowered to BB from BB+ by Fitch Ratings.

  • Risks to macroeconomic stability have intensified owing to the widening in the current account deficit, more challenging global external financing environment, jump in inflation and the impact of the plunge in the exchange rate on the private sector: Fitch
  • Economic policy credibility has deteriorated in recent months and initial policy actions following elections in June have heightened uncertainty, the rating agency said in a statement
  • Fitch expects CAD to widen to 6.1% of GDP in 2018, driven by higher fuel prices, and in 1H, higher household consumption
  • Fitch forecasts annual average inflation to be more than double the current BB range median, at 13% in 2018 and 10.8% in 2019
  • Outlook on the rating is negative

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