Turkey Insight: Not weak at the knees yet? Credit default swaps just hit 520

Akin Nazli in Belgrade May 24, 2019

Global markets are pricing in a Turkish default. The Erdogan administration is fixated on its pre-election stimulus and flattering Trump. The IMF says it ain’t had a call. And the IIF quite frankly is saying WTF?

ANALYSIS: Turkey’s net FX reserves excluding swaps hit minus as of May 17

Akin Nazli in Belgrade May 23, 2019

bne IntelliNews’ calculations show the precarious situation the central bank faces as the unrelenting battle to defend the lira takes an alarming toll. No wonder Turks fear for their hard currency savings.

Istanbul revote: Ousted mayor says AKP spent TRY80mn in three years on city’s website

bne IntelliNews May 22, 2019

Ekrem Imamoglu, who will fight an election rerun in what observers say is a crucial test of remaining democracy in Turkey, unveils alleged misspending.

ISTANBUL BLOG: Talk of a Turkey default grows as spooked investors ask ‘What comes next?’

Akin Nazli in Belgrade May 22, 2019

Ankara is running out of options in its fight to defend the lira and raise capital.

Turkey has closed its ports to Iranian oil: reports

bne IntelliNews May 21, 2019

If the move is confirmed it would fly in the face of aggressive rhetoric from Ankara in which it has said the US cannot deny it the right to import energy shipments from its neighbour.

Turkey’s consumer confidence index collapses 14%

bne IntelliNews May 21, 2019

May’s reading is the lowest ever recorded since the data compilation began 15 years ago. Renewed weakening of lira appears to have hit sentiment.

Turkish government’s gross debt stock hits new high in April after lira’s latest travails

Akin Nazli in Belgrade May 20, 2019

State budget fiscal metrics currently more vulnerable to a currency crisis than they were before last summer’s nasty episode. And fresh market turmoil is widely expected.

Cyprus threatens “arrest warrants” over Turkish drilling

bne IntelliNews May 20, 2019

As Turkey’s first ever drillship, escorted by a naval frigate, prepares to start operations, Ankara declares it “does not recognise the unilateral and illegitimate exclusive economic zone claims of the Greek Cypriots”.

Economic and democratic failings dog Erdogan as he hits out at criticism from Turkey’s top business association

bne IntelliNews May 19, 2019

President targets tycoon who heads group’s advisory council. Tuncay Ozilhan raised concerns over Turkish industry’s debt woes and said country must abide by universal principles of democracy or “it becomes something else”.

Garanti latest Turkish bank to renew syndicated loan at higher costs, lower roll-over ratio

Akin Nazli in Belgrade May 17, 2019

Despite Turkey’s economic strife, local lenders’ spring loan refinancing season is progressing undeterred. But Libor and Euribor rates have almost doubled compared to a year ago.

Turkish private sector’s 1-year FX loan repayment obligations fall 3% m/m to $60.4 bn in March

Akin Nazli in Belgrade May 16, 2019

Assessing economic flashpoints on horizon, analyst says external debts equal to around 24% of Turkey’s GDP need to be serviced over the next 12 months, leaving the lira vulnerable to bouts of risk aversion.

Turkey’s central government budget deficit soars 135% y/y in Jan-April

Akin Nazli in Belgrade May 15, 2019

Typically praised, the Treasury's housekeeping is going to pot amid country's economic turmoil.

Turkish industrial production contracts for 7th straight month

Akin Nazli in Belgrade May 14, 2019

Calendar-adjusted index in positive territory. Fresh pre-election stimulus on the cards. Economy may have grown in Q1 but double-dip recession not ruled out. Istanbul revote impact may hinge on battle for Kurdish vote.

Slovenia, Israel and Turkey benefit from Kosovo’s politically motivated import tariffs

Valentina Dimitrievska in Skopje May 13, 2019

100% import tariffs on goods from Serbia and Bosnia have pushed consumer prices up in Kosovo, but politicians’ claims they would help local producers were never realised, think tank GAP finds.

Turkey’s current account gap contracts 88% y/y in Q1 as lira crisis crushes imports

Akin Nazli in Belgrade May 13, 2019

More market jitters on report that Treasury may tap central bank reserves to borrow 40bn lira as government budget deficit is deeper than expected. OMFIF op-ed says Erdogan’s mishandling of currency crisis heightens probability of Ankara default.

TURKEY INSIGHT: Claims over officials' lira manipulation via state banks hit international fan

Akin Nazli in Belgrade May 10, 2019

Public lenders reportedly sold $1bn on May 9 and overnight to curb latest bout of depreciation. Officials have been up to no good for months, but it’s gone unreported.

Turkish bond yields rise as analysts worry central bank is close to losing control of the market

Ben Aris in Berlin May 9, 2019

Yields on Turkish global bonds jumped as political tensions over the upcoming re-run of the mayoral election in Istanbul gave investors the jitters. Raiffeisen International analysts see the central bank as in danger of losing control of the market.

ISTANBUL BLOG: Turkey mired in ‘death of democracy’ outrage—but global lenders are unfazed

Akin Nazli in Belgrade May 9, 2019

Erdogan party hacks nevertheless ask why markets give this particular authoritarian regime such a hard time. Answer may be its lack of technocrats with freedom to run macro policy. Lickspittles get you nowhere.

Turkey’s Yapi Kredi Bank obtains 367-day $1bn syndicated loan

Akin Nazli in Belgrade May 8, 2019

All-in cost will be Libor+250bp and Euribor+240bp.

Environment for SMEs improved in Western Balkans, Turkey but potential still unexploited

bne IntelliNews May 7, 2019

SMEs are under-represented in international trade and their contribution to value added remains low, the latest SME Policy Index finds.