Moody's focuses on the increasing risk factors, especially for developing countries.The agency announced the credit ratings and economic outlook for some developing countries in the world like Turkey. Following the announcement made by independent credit rating agency Moody's, the Turkish Lira started weekly depreciation. The institution protected Turkey's credit rating as 'Ba1', but the view of the note determined as negative. Moody's lowered Turkey's credit rating below the investment grade. Therefore, the influence of the announcement on the markets was limited. On the other hand, the details of the explanatory text are important for drawing attention to the risks.
The agency also published a report after this decision. For Turkey, attention was drawn to the fact that the political environment was strained following the initiative of the coup attempt on July 15. The referendum of constitutitonal amendment will be held on April 16 is the main risk factor. The agency also mentioned that the measures taken against the economic slowdown did not solve the structural problems. One of the reasons for the news-based rise in the USD/TL range was the retracement of the Dollar Index. When we look at the American side briefly, Trump's conservative trade policy expectations are causing a depreciation of the Dollar.
- Date: 20 March 2017 Mon 09:23
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