S&P revises Turkey to stable

S&P said it revised its outlook on the Republic of Turkey to stable from negative and affirmed its unsolicited BB+/B foreign currency long- and short-term sovereign credit ratings and BBB-/A-3 local currency long- and short-term sovereign credit ratings.

The agency also affirmed its unsolicited trAAA/trA-1 long- and short-term Turkey national scale ratings.

S&P said the outlook revision reflects the demonstrated resilience of the Turkish economy and its view that risks to the financing of Turkey’s still-large current account deficit and the roll-over of its external debt have moderated.

The Turkish economy has faced several challenges – escalating domestic violence following the ending of the peace process with Kurdish militants, two general elections, a sharp depreciation of the lira amid sustained portfolio outflows, heightened instability along its southeastern border and weaker demand from major export markets.

Despite these challenges, during 2015 the economy expanded by 4% versus S&P’s original expectation of 3.1% at the time of the Nov. 6, 2015, affirmation, the agency said.

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