This site uses cookies to provide you with a great user experience. By using BondbloX, you accept our use of cookies.
Bond Market News
Turkey Hikes Rates by 250bp, Lower than Expected; UAE to Purchase $8.5bn in Sukuk
July 21, 2023
Turkey’s central bank raised its policy rate by 250bp to 17.5%, missing forecasts for a 500bp rate hike. A lower-than-expected rate hike was also observed last month, where interest rates were hiked to 15% as opposed to a forecasted level of 21%. Nevertheless, the central bank pledged to take additional steps to remove excess liras from financial markets, with a source saying that it will increase lenders’ lira reserve requirements to remove excess lira liquidity and strengthen the currency. Turkey’s Monetary Policy Committee (MPC) also announced that it took steps in “quantitative and selective credit tightening” to support the monetary policy stance but did not elaborate on them.
Separately, the UAE has pledged to purchase as much as $8.5bn in sukuk from Turkey yesterday as part of deals potentially totaling more than $50bn signed between the two countries during President Erdogan’s visit to Abu Dhabi earlier this week. The funds will contribute to Turkey’s reconstruction efforts following a deadly earthquake in February, easing the government’s funding pressures.
Turkey’s dollar bonds have trended higher since the last two weeks, up by 3-7 points across the curve. Its 5.75% Sukuk due 2047 has ticked higher by 1.1 points since the start of the week to trade at 71.1 cents on the dollar, yielding 8.6%.
Go back to Latest bond Market News
Related Posts:
BondbloX Pte. Ltd. is regulated by the Monetary Authority of Singapore as a Recognised Market Operator ("RMO") and exempted from Section 49(1) of the Securities and Futures Act (Cap. 289) ("SFA") under Section 49(7) of the SFA.