Fitch Revises Outlook of Turkey’s Long-Term Issuer Default Ratings to Negative; Affirms BB- Rating

Fitch Ratings (Fitch) has revised the Outlook on Turkey’s Long-Term Issuer Default Ratings (IDR) to Negative from Stable, while affirming the IDRs at BB-.

The outlook revision was driven by falling gross foreign exchange reserves, fragile credibility of monetary policy, a sharp fall in interest rates as well as a deterioration of current account balance partially powered by a robust credit stimulus, which have worsened external financing risks. Furthermore, Fitch stated that there was increased risk that policy is not tightened enough, caused by lack of independence of Central Bank of the Republic of Turkey, political pressures, as well as a slow response rate to events, which add to further external imbalances an...