Turkey welcomes Moody's upgrade, bond yields tumble

By REUTERS
May 17, 2013 12:35

ISTANBUL - Turkey hailed its second investment grade rating on Friday, seeing it as a seal of approval from international markets for a decade of economic reform.

Investors joined in, driving sovereign bond yields to record lows.

Government enthusiasm was tempered, however, by some concern that the move, coinciding with a visit by Prime Minister Tayyip Erdogan to Washington, might trigger over-large capital inflows into the lira currency.

Moody's assigning a Baa3 rating with a stable outlook to Turkey late on Thursday, making it eligible for inclusion in a number of investment-grade only bond indices and adding to the economy's switch from an emerging market to a developed one.

Fitch Ratings lifted Turkey to investment-grade in November, while Standard & Poor's rates Turkey one notch below.


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