Standard & Poor's (S&P) expects uncertainty to persist in Turkey over the next few months after the inconclusive June 7 elections, Reuters reported on June 18, citing a an e-mailed note by the ratings agency on the credit implications of the parliamentary vote.
If no coalition is formed and Turkey heads to the polls again, political uncertainty would remain heightened until the end of the year, which could potentially hamper growth if business investments are postponed, said S&P, adding that it could consider a Turkish downgrade if developments such as lira volatility, consumer confidence and inflation were to weaken fiscal performance and debt metrics were to deviate from current expectations.
The election outcome could reduce pressure on the judiciary, the financial regulator and central bank, and therefore could potentially improve policy predictability, S&P also said in the note.
S&P had said on June 8 that the outcome of the general elections had no immediate impact on its sovereign credit ratings (unsolicited foreign currency BB+/Negative/B; unsolicited local currency BBB-/Negative/A-3).
According to the unofficial results, the AKP received 40.87% of the votes in the June 7 elections while the main opposition CHP got 24.96%, the nationalists MHP garnered 18.29% and the Kurdish HDP got 13.12% of the votes. The AKP will have 258 seats in the 550-seat parliament, the CHP 132, the MHP 80 and the HDP 80 seats.
Turkey’s main business lobby has called on the government to end the 19-month-long state of emergency introduced in July 2016 after the failed coup. At the end of last week, parliament extended ... more
Turkey will not extradite any terror suspects to the US if Washington continues to refuse to hand over Fethullah Gulen, President Recep Tayyip Erdogan said on January 11. Ankara blames the ... more
The Turkish central bank reported on December 7 that its gross forex reserves last week experienced a record drop, declining to $89.85bn on December 1 from $96.35bn a week earlier. ... more