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Turkey’s opposition party CHP, handed President Erdogan’s ruling AK Party a defeat in the local elections. This is being considered as a de facto referendum on Erdogan and comes less than a year since he won the national elections. Among the big upsets was his party candidate’s loss in Istanbul where Erdogan grew up and was elected as the mayor in 1994. Another notable loss was in the capital city of Ankara. BBC notes that the opposition broadly controls the west, south and north of Turkey while the ruling party holds central Turkey and has had more success in areas of the south-east. Analysts note that the biggest reason for AK Party’s defeat is the state of the economy and high inflation. The latest inflation reading came in at 68.5% for March vs. 67.1% in February. With this, the lira has depreciated heavily and cost of living has escalated. Erdogan announced that the 2023 presidential elections would be his last. However, many observers expect him to bring in a new constitution that allows him to rule beyond 2028 when the current term ends.
Turkey’s dollar bonds were trading stable with its 5.875% 2031s at 91.8, yielding 7.36%.