News World S&P lowers Turkey's credit rating deeper into junk territory

S&P lowers Turkey’s credit rating deeper into junk territory

Standard & Poor’s said on Friday it had cut Turkey‘s sovereign credit rating deeper into “junk” territory, citing extreme lira volatility and forecasting a recession next year, adding to the country’s woes as it deals with a currency crisis.

The rating agency downgraded the rating by one notch to B+ from BB- and kept Turkey‘s outlook at stable in a move which came after the lira lost some 40 percent of its value against the dollar this year.

“The downgrade reflects our expectation that the extreme volatility of the Turkish lira and the resulting projected sharp balance of payments adjustment will undermine Turkey‘s economy. We forecast a recession next year,” S&P said.

It also forecast that inflation will peak at 22 percent over the next four months and said the weakening lira was putting pressure on the indebted corporate sector and had considerably increased the funding risk for Turkey‘s banks.

“Despite heightened economic risks, we believe the policy response from Turkey‘s monetary and fiscal authorities has so far been limited,” the statement added.

The currency crisis has been precipitated by investor alarm about President Tayyip Erdogan’s influence over monetary policy and fuelled by a deepening row between Turkey and the United States

Top Stories

Tatar sends hardliner messages just before meeting Anastasiades

Newly elected Turkish Cypriot leader Ersin Tatar is willing to meet President Nicos Anastasiades but keeps sending messages on his hardliner position on the...

Former U.S. President Obama campaigns for Joe Biden

Former U.S. President Barack Obama puts on his face mask after his speech as he campaigns on behalf of Democratic presidential nominee and his...

Ireland will be eurozone’s biggest loser from a no-deal Brexit

Irish central bank Governor Gabriel Makhlouf warned that Ireland will be the eurozone's biggest loser from a no-deal Brexit, which could cause an economic...

Germany: Turkey should stop illegal activities against Cyprus and Greece

If Turkey wishes to have a new customs union with the EU it should cease illegal activities against Cyprus and Greece, Ulrike Demmer Germany’s...

Turkey extends exploration in disputed Mediterranean waters to Oct. 27

Turkey said late on Wednesday it extended the stay of its Oruc Reis survey vessel and two other ships in a disputed area of...

Taste

Squash soup

Ingredients: 1 kg pumpkin, cut into small cubes, approximately 5 cups 2 medium (400g) sweet potatoes, cut into cubes, approximately 2 ½ cups 1 chopped leek, only...

Mezedes

No visit to Cyprus is complete without enjoying the traditional meal of many small dishes known as ‘meze’. This large feast, which has been a...

Prawns with fried cheese, barley shaped pasta

Put the barley shaped pasta into a small pan with salted water, bring to a boil and when tender, drain. Peal the prawns leaving...

Salmon and shrimp sheftalies

Mix all ingredients for tabbouli in a bowl and keep to one side so flavours can combine. Prepare the sheftalies: wash and soak the casing...