The gradual disappearance of uncertainties that have been going on for a while in Turkey continues to have an impact on the country’s risk premium.
While the election period and the completion of the handover procedures by the new economy administration as of yesterday were followed closely in the markets, Turkey’s CDS accelerated its downward trend with the first messages received from the new economy administration.
Turkey’s 5-year CDS fell below the 500 level for the first time since May 15 with these developments, while the daily decline exceeded 50 basis points.
Analysts stated that the messages given by the new economy management were welcomed in the markets and that the steps to be taken were placed in the focus of investors.
Drawing attention to the importance of the new economy management’s emphasis on the fight against inflation, analysts noted that it is expected that the signal of a stronger fight against the declining inflation is expected to support financial stability.
Analysts stated that the expectations that the interest rate hike cycle, especially the US Federal Reserve (Fed), will come to an end gradually, has also eroded the risk perception around the world.
BIST 100 index, at the top of the last 3 months
Analysts stated that Borsa Istanbul was also positively affected by the news flow and noted that the BIST 100 index was at the peak of the last 3 months.
BIST 100 index, which rose to 5,323 points, the highest level since March 14, yielded close to 9 percent in June.
The “market friendly” messages of the economy management draw attention
Mehmet Şimşek, who took over the duty of Ministry of Treasury and Finance from Nureddin Nebati yesterday, said, “The main goal of our government is to increase social welfare. In the coming period, our basic principles will be transparency, consistency, predictability and compliance with international norms.” said.
Şimşek stated that the main goal of the government is to increase social welfare and made the following assessment:
“Transparency, consistency, predictability and compliance with international norms will be our basic principles in achieving this goal in the coming period. Turkey has no choice but to return to a rational basis. A rule-based, predictable Turkish economy will be the key to achieving the desired prosperity. “We will prioritize macro-financial stability by strengthening our institutional quality and capacity in a conjuncture of increased growth. We will start our medium-term program studies without wasting time. Establishing fiscal discipline for sustainable high growth and ensuring price stability will be our main goals.”
Emphasizing that it is vital for Turkey to reduce inflation to single digits again in the medium term, to increase predictability in all areas and to accelerate the structural transformation that will reduce the current account deficit, Şimşek said that supporting the Central Bank of the Republic of Turkey (CBRT) in the fight against inflation through the fiscal policy and structural reforms to be implemented will be their main policy. recorded.
Taking over the post of Vice President, Cevdet Yılmaz said, “We will attach special importance and priority to the fight against inflation, which affects the lives of our citizens. On the one hand, we will continue to resolutely implement our policies aimed at relieving large social segments facing the negative effects of inflation, with the awareness that this will take time.” said.
