FX.co ★ Turkey 10-year Bond Yield at Record Levels

The yield on Turkey's 10-year government bond has climbed beyond 31%, marking its highest point in over a decade, before slightly retreating. This shift reflects investors' growing apprehension towards Turkish assets amid intensifying political instability. Istanbul's mayor, Ekrem Imamoglu, a significant figure in Turkish politics and a principal opponent of President Erdogan, has been formally arrested and sentenced on charges of corruption. This recent arrest, along with the annulment of his university diploma, is likely to prevent him from running against Erdogan in the forthcoming elections, a situation that has sparked widespread protests and a sharp downturn in Turkish markets. Imamoglu was the leading candidate for the presidential nomination of the Republican People’s Party (CHP), the main opposition party. In response to these events, Turkey's central bank recently increased its key overnight lending rate by 200 basis points to 46% in an emergency measure and has been in talks with top financial institutions in a bid to stabilize the market.