İSTANBUL (CİHAN)- Credit ratings agency Moody's intends to keep Turkey at its investment grade rating for the time being, Moody's Turkey analyst Alpona Banerjee told media on Wednesday.
The ratings agency is opting to keep Turkey at its Baa3 rating after having passed several times on making a rating adjustment this year.
The country's financial power, low debt levels and large middle income presence are the main factors supporting Moody's decision to hold its rating, said Banerjee.
The investment grade rating is nevertheless at risk amid a plummeting lira and a period of ongoing political uncertainty that has raised fears of continued outflow of foreign capital. A new set of elections on November seem unlikely to produce results radically different than the ones on June 7 that left the country with a hung Parliament and an atmosphere of uncertainty that weakened the economy.
Weeks of violence at the hands of the Kurdistan Workers' Party (PKK) have resulted in almost daily casualty reports from Turkey's southeastern region, creating an image of deep instability and painting a bleak portrait of the months to come.
Moody's is expected to weigh in next on Dec. 4. The last revision to its outlook came in November of last year when the outlook was revised from "stable" to "negative." Baa3 is the lowest investment grade rating assigned by the agency.
Last month, the Financial Times wrote that Turkey is "teetering on the threshold of 'junk' status" and an additional downgrade would negatively impact investments, while ratings agency S&P said that political uncertainties remain high in the midst of a possible early election, and that these uncertainties may result in further depreciation of the already floundering Turkish lira and may also negatively impact consumer confidence and inflation rates.
(Cihan/Today's Zaman) CİHAN
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