Moody’s says any political uncertainty in Turkey to be credit negative
ISTANBUL - ReutersAny renewed political uncertainty in Turkey is credit negative as it could diminish investor confidence, said credit ratings agency Moody’s on May 5, after Prime Minister Ahmet Davutoğlu announced he would be stepping down.
“Political uncertainty could also delay the implementation of the announced reform process to enhance growth prospects and reduce Turkey’s external vulnerability,” Moody’s said in an emailed statement.
In an address, Davutoğlu said that “investors should not worry about the continuity of stability” because a “strong” Justice and Development Party (AKP) government would continue.
But his departure could mean an early election this year and, for investors, more uncertainty about the stewardship of the economy when private sector debt is high, savings are low and some circles continue to champion lower interest rates to boost growth through consumption.