Turkey
ISTANBUL BLOG: Erdogan’s regulators hit uncooperative private banks with blunter instrument
Watchdog amends asset ratio calculation methodology after lenders find loopholes. President determined all banks should play a full role in delivering more cheap money. But some non-state players appear to be getting heartily fed up.
May PMI shows Turkish manufacturing buffeted again but signposts road to recovery
Reading improves to 40.9 from 33.4 in April. Move to growth should follow as long as COVID-19 continues to be brought under control, says IHS Markit.
No cause to party in Turkey with Q1 growth of 4.5% y/y overshadowed by “ominous” outlook for Q2
Capital Economics pencils in second-quarter contraction of around 15% q/q on pandemic impacts.
Turkish Treasury taps $3bn from domestic paper sales to local banks ahead of eurobond redemption
Turkey’s state banks sold around $44bn of hard currency in first four months of this year and $77bn since start of 2019 to support embattled lira, analyst’s calculations indicate. May expected to bring 2020 sales to $50bn+.
Trump Towers Istanbul partner ‘lobbied White House for vast expansion of US-Turkey trade’
News service uses documents deposited by PR firm to reveal Mehmet Ali Yalcindag’s activities. Now head of Turkey-US Business Council, the businessman, once called a “close friend” by Donald Trump, is pushing to build up agriculture and LNG shipments.
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For first time Turkey’s LNG imports outstrip pipeline gas imports
Gas delivered via pipelines from Russia and Iran down 72% y/y and 33% y/y in March. US expanding shipments of liquefied natural gas amid glut as spot prices fall.
LONG READ: A thinking exercise on Turkey and its lira
Erdogan administration officials are working around the clock trying to convince the world the currency can defy gravity. Nothing adds up in their favour. The worry is that they will end up trying to defy voters instead.
Turkey ‘treads carefully’ as benchmark rate is cut by 50bp
Easing comes on back of some stabilisation in the embattled lira but markets remain concerned by country’s lack of FX reserves.
Gulf ally Qatar expands swap line to help Turkey defend lira
Currency falls slightly after news. Markets want to see more. Finance minister remarks “Imports will not be easy” as Ankara moves to boost domestic production. Turkish officials, meanwhile, said to be concerned by possible new rush for dollars.
Fitch cuts outlook on three Turkish banks citing Ankara’s weaker FX reserves
Rating agency also downgrades Halkbank from ‘B’ to ‘B+’. Ability of sovereign to support lenders in event of need has declined, it says.
Russa’s coronavirus cases close to 300,000 but PM says growth in new cases has halted
Slowdown in new cases in Eastern Europe, while lockdowns already being lifted in Central and Southeast Europe.
Markets seek leads on who might come through to save Turkey from second currency crisis danger
Ankara appears to be in swap line talks with UK, Japan, Qatar and China.
Negative surprise as Turkey posts March industrial production decline of 2% y/y and 7% m/m
Despite onset of pandemic and lockdowns market was expecting some growth.
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Bar high to Fed swap line for Turkey but Trump could weigh in says former top central banker
“I’m fairly sure that we will end up there eventually,” says academic in response to prospect of IMF bailout or capital controls.
Turkey steps up import compression and capital control efforts
Critic says Erdogan’s cajoling to keep rates low has caused investors to dump lira. With FX reserves sinking, back-door ways to lift currency, such as by squeezing trade, will be needed, but will shred central bank's remaining credibility, they add.
Press freedom watchdog calls on Turkey to revise regulation that ‘threatens financial reporting’
Academics say directive may prompt journalists to self-censor for fear of being fined.
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Retail sales under lockdown across Central and Eastern Europe are sinking
A worldwide lockdown has created havoc for retailers as their customers are forced to stay at home. There has been a little respite as sales in March surged due to panic buying but that has given way to a lockdown that keeps stores closed
TURKEY INSIGHT: U-turn in the face of ‘Devil’s triangle’
Officials lift UBS, Citi, BNP lira trading ban. Under regulator’s beady eye, local brokers stop offering FX trading on margin to retail clients. Foreign investors exit country at breakneck speed.
Turkey’s TAV and partner pay $415mn for Almaty Airport
Seen as sitting on strategic Asia-Europe trade junction along China's Belt and Road initiative to develop infrastructure and associated investments.
TURKEY INSIGHT: The lira has belly-flopped and London, it is your fault
Government media point finger at foreign market players as Turkish currency falls to all-time low. Banking watchdog issues wide-ranging regulation on manipulative trading. Critics say it has no parallel anywhere else in the world.