0 comments

Turkish Lira Jumped After Erdogan Wins Presidential Election

by on August 11, 2014 8:08 am GMT
 

USDTRY rose 0.3 percent to 2.1383 per dollar as of 8:37 a.m. in Istanbul, making it 0.5 percent stronger this year. The lira weakened 0.5 percent against the dollar last week as conflicts raged in Iraq and Syria to the south, Armenia to the east and Ukraine across the Black Sea.

The lira advanced as Prime Minister Recep Tayyip Erdogan became Turkey’s first directly elected president, extending his rule through 2019.

The victory consolidates the Justice and Development Party’s hold on power after an almost 12-year tenure, the longest period of political stability since a multiparty system was adopted in 1946.

USDTRY rose 0.3 percent to 2.1383 per dollar as of 8:37 a.m. in Istanbul, making it 0.5 percent stronger this year. The lira weakened 0.5 percent against the dollar last week as conflicts raged in Iraq and Syria to the south, Armenia to the east and Ukraine across the Black Sea.

Erdogan, 60, who won 52 percent of the vote, according to the state-run Anatolia Agency, will have to step down as leader of the AKP to assume the presidency on Aug. 28. The party has 45 days to pick his successor, who will be appointed by the president to head the government. Erdogan’s 11-year tenure as premier saw annual growth average 5 percent, with foreign investors pouring $78 billion into Turkish stocks and bonds since 2006.
Foreign Investment

The nation’s economic growth has been fueled by consumption and private-sector borrowing that swelled the current-account gap to 7.5 percent of gross domestic product in the first quarter. That’s the biggest among the so-called fragile five economies most vulnerable to a withdrawal of foreign investment needed to finance their deficits. South Africa, Indonesia, India and Brazil are the other four.