Turkey 10Y Bond Yield on the Rise

Turkey's 10-year government bond yield rose to 27.7% as demand surged for local assets.

The Turkish central bank kept interest rates unchanged at 50% in May, and said monetary policy will be tightened in case a significant and persistent deterioration in inflation is foreseen.

Additionally, the government has been implementing more traditional measures to rebuild market confidence, such as lifting a regulation that previously required banks to purchase lira-denominated government securities.

Consequently, excess liquidity stemmed from the surge in domestic and foreign demand for Turkish lira denominated financial assets, which the central bank stated it would address through additional measures.