Economics
Turmoil Sends Turkey Markets to Worst Week of Erdogan Presidency
- BofA to Commerzbank turn pessimistic on country's outlook
- Currency volatility surges as political tensions deepen
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Turkey’s stocks and bonds headed for the worst week since 2013 and currency volatility surged as a renewed political upheaval accelerated a selloff sparked by hawkish signals from Federal Reserve officials.
The Borsa Istanbul 100 Index dropped 9 percent this week and the yield on 10-year government bonds jumped 54 basis points as Prime Minister Ahmet Davutoglu lost a power struggle and said he would step down. The latest twist in what’s seen as President Recep Tayyip Erdogan’s quest for greater powers prompted Nomura Plc to say the risk of a credit downgrade may have doubled and Commerzbank AG to lower growth forecasts for this year and the next.