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Fitch may lower credit rating of Turkey

Ratings agency Fitch may lower the credit rating of Turkey in August 2016, when its assessment should be published. The attempted coup in Turkey, and the authorities’ reaction highlights the political risks of sovereign credit profile of the country. Whether the situation in Turkey will affect its credit rating, will depend on the response of the government and any consequent deepening political divisions and a further weakening of institutions.

Agency finds that there is insufficient political support for the removal of President Recep Tayyip Erdogan, regardless of anti-government sentiment and dissatisfaction with the aspirations of the Turkish head of state for more power.

“The low rating of the country in terms of government, set by the World Bank, have long made an impression in the profile of Turkey. This factor is not incompatible with a rating of BBB-, but is able to weaken the creditworthiness of the country”, says Fitch.

The new assessment by Fitch on Turkey will be published on August 19.

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