Turkish Lira Falls Sharply After AK Party Lost Its Parliamentary Majority
Turkey’s financial markets were rattled on Monday with the lira tumbling to a record low against the dollar and government bond yields surging after the country’s AK party lost its parliamentary majority after 13 years in power.
The stock market fell by more than 8 per cent after Sunday’s election brought an end to years of single-party rule and spelt the end to president Recep Tayyip Erdogan’s campaign Sinan Ulgen Best outcome for Turkey.
The lira fell by 5 per cent against the dollar to 2.79 lira. The main Turkish stock market index, the BIS 100, was down more than 7 per cent at 75,950, after recovering slightly from an initial plunge of 8 per cent.
It was the first time the index had fallen below 80,000 since March.
Yields on the country’s 10-year benchmark government bond rose from 9.32 per cent on Friday to 9.94 per cent on Monday as investors sold Turkey’s sovereign debt.
AKP support fell to 41 per cent, from almost 50 per cent in the previous general election four years ago, based on results from almost 100 per cent of polling booths.