The Turkish bourse closed 2.0 percent lower on Friday, July 13, as investors confidence remains low despite the recent $3.2 billion loans by the World Bank and the Inernational Monetary Fund (IMF). The national index of the Istanbul exchange ended the week 182 points lower at 8,941 points.
High interest rates and the continuously falling bourse has lead investors to become increasingly hesitant as to the political stability and the implementation of the long-promised economic reforms in the country.
The yield on heavily traded treasury bonds maturing in March of next year fell by approximately 10 percentage points, reported AFP news agency. Although Turkey’s treasury chief assured investors that there is no risk of a debt default, investors remain fearful that such rates could eventually endanger the rollover.
In addition, Argentina’s recent economic difficulties, coupled with the 8.16 percent plunge of the Buenos Aires stock exchange on Thursday, has increased the risk of investments in emerging markets such as Turkey in the eyes of foreign investors.
Although the central bank sold dollars at a slightly lower rate of 1,330,000 Turkish lira to the US dollar on Friday, the depreciation of Turkey’s currency since February’s financial crisis stands at 48 percent. — (MENA Report)
© 2001 Mena Report (www.menareport.com)
