Moody’s Raises Turkey’s Credit Rating, Lira Remains Soft

The Turkish lira was a bit soft today even as Moody’s Investor Service increased Turkey’s credit rating, making nation’s assets more appealing to investors.
Moody’s raised Turkey’s government bond ratings by one notch to Baa3 from Ba1 and assigned a stable outlook. The rating agency cited following reasons for the decision:

1. Recent and expected future improvements in key economic and public finance metrics.

2. Progress on structural and institutional reforms that Moody’s expects will reduce existing vulnerabilities to shocks to international capital flows over time.

It was the first investment grade increase in two decades. Higher creditworthiness of Turkey should attract more foreign inflows into the country.
USD/TRY fluctuated near the opening level of 1.8239 after rising to 1.8260 and EUR/TRY was little changed at 2.3498 as of 00:11 GMT today following the increase to 2.3527.

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