Emerging Europe Economics Update Turkey’s debt repayment crunch Turkey’s economy has so far managed to come through the worst of the plunge in the lira without suffering acute financial stress. That said, the banking sector faces a large external debt repayment... 20th August 2018 · 1 min read
Emerging Europe Economics Focus Turkey: what next? The plunge in the Turkish lira is likely to push inflation above 20% and tip the economy into recession in the coming months. Our base case is that GDP growth will now average 3.0% over 2018 as a... 15th August 2018 · 15 mins read
Global Markets Update What the crisis in Turkey means for EM currencies Emerging market (EM) currencies have weakened against the dollar again today on worries about Turkey. While the pressure from this source might not last long, we think that the outlook is fairly poor... 13th August 2018 · 1 min read
Emerging Markets Economics Update EM central banks unlikely to respond to FX weakness EM currencies have come under pressure over the past few days as Turkey’s crisis has escalated, but history suggests that such sentiment-driven sell-offs tend to be short-lived. We wouldn’t expect the... 13th August 2018 · 1 min read
Emerging Europe Economics Update Where do the risks in Turkey’s banking sector lie? Turkish policymakers have taken steps to support local banks today, but concerns have continued to mount about the health of the sector. Banks appear to hedge all their on-balance sheet FX mismatches... 13th August 2018 · 1 min read
Africa Economics Update South Africa: Turkey parallels The falling rand has, yet again, highlighted the currency’s vulnerability to EM risk sentiment. From an economic perspective, however, the country’s situation is very different from Turkey’s building... 13th August 2018 · 1 min read
Asia Economics Update What does the crisis in Turkey mean for Asia? There is a good chance that the recent volatility in financial markets triggered by the crisis in Turkey will prompt Bank Indonesia into hiking interest rates at its meeting on Wednesday. For most... 13th August 2018 · 1 min read
Global Economics Update How big a worry is Turkey? The plunge in the lira which began in May now looks certain to push the Turkish economy into recession and it may well trigger a banking crisis. This would be another blow for EMs as an asset class... 10th August 2018 · 1 min read
Emerging Europe Economics Update Where to watch for signs of stress in Turkey’s banks? The collapse in the lira has raised concerns about the health of Turkey’s banking sector. Banks’ dollar bonds yields and interbank interest rates are already pointing towards some stress, and these... 10th August 2018 · 1 min read
Europe Economics Weekly Worries over Turkey and Italy hit European markets While worries about the exposure of euro-zone lenders to Turkey weighed on the euro and European banking stocks on Friday, the economic spillovers to the region should be fairly modest. Meanwhile... 10th August 2018 · 1 min read
Global Economics Update How big a worry is Turkey? The plunge in the lira which began in May now looks certain to push the Turkish economy into recession and it may well trigger a banking crisis. This would be another blow for EMs as an asset class... 10th August 2018 · 1 min read
Emerging Markets Economics Update Will Turkey’s crisis affect other EMs? Aside from the impact on a few small neighbouring countries, most notably Bulgaria, the direct risk of contagion from Turkey’s crisis to other EMs is fairly low. However, Turkey’s problems may add to... 10th August 2018 · 1 min read
Emerging Europe Economics Weekly Turkey on the brink Turkey seems to have been on the brink of a crisis several times this decade, only for the central bank to do just enough to steady the ship. But there are reasons to think that emergency interest... 10th August 2018 · 1 min read
Emerging Europe Economics Update Sanctions and the importance of balance sheets The fact that the US sanctions (or the threat of) are having a bigger impact on financial markets in Turkey than Russia reflects the latter’s much stronger balance sheets as well as the credibility of... 9th August 2018 · 1 min read
Emerging Europe Economics Update How can Turkey get out of its crisis? The lesson from other countries that have suffered from currency crises is that fiscal and monetary policy will need to tighten, preferably under the auspices of an IMF deal, to stabilise the economy... 8th August 2018 · 1 min read
Emerging Europe Economics Update A fresh look at Turkey’s banking sector risks The plunge in the lira and rise in borrowing costs is likely to push the Turkish economy into a technical recession in the second half of this year. But the vulnerabilities that have built up in the... 8th August 2018 · 1 min read
