Real Yields at Two-Year High Offer Little Comfort: Turkey Credit
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Turkish bond yields near the highest in two years once inflation is accounted for are proving insufficient to lure traders seeing the need for further rate increases to shore up the weakening currency.
Real yields on Turkey’s two-year notes touched 3.66 percent on Jan. 28, the most since October 2011, according to data compiled by Bloomberg. That’s higher than Russia, India, Indonesia and South Africa, the data show. Turkish producer prices surged 10.7 percent in January from a year earlier, a report showed yesterday, suggesting the full effect of lira weakness has yet to be passed onto consumers, who saw inflation accelerate more than forecast in the period, to 7.5 percent.