Loose economic policy has helped Turkey and its related exchange traded fund (ETF). Thanks to a round of efforts aimed at reviving its economy, the Turkey ETF was one of last week’s top performers.
The Turkish Central Bank cut its benchmark overnight borrowing to a record 7.75% low last Tuesday, and further cuts will be necessary if no signs of a robust economic recovery occur, reports Nevzat Devranoglu for Forbes.
The yield on the benchmark bond hit a fresh low of around 9.6%. However, interest rate expectations have been lowered to about 6.5%-6.75%.
Turkey’s market index has been driven up by the help of the banking sector, which make up around 40% of the market. Bank earnings have been bolstered by a series of rate cuts that has reduced interest on customers’ deposits as lending rates remain high.