Early this year we identified the Lira as significantly overvalued , given last year's policy mix that widened the current account deficit. However
Sharp drop in global trade volumes, driven mainly by emerging markets' Warning bell on global stocks as defensives outperform cyclicals' FX-denominate
EMs with large external funding needs are under pressure. The Turkish Lira is one of the currencies in focus. We present external funding scenarios to
Turkey hikes rates to support the lira-will this movie replay in other markets? Rise in EM local currency yields has been modest, compared to the tape
Markets are turning less friendly towards carry trades, which is weighing on EMs with large external funding needs. Earlier this year we scanned EM
Real GDP growth was strong in 2017, fueled in part by a sizable credit impulse.' This year, the credit impulse will likely be negative.' We forecast a
Sizable government credit guarantees boosted output growth this year. With the credit impulse weakening, output growth will likely slow down to 4% or
Ongoing lira weakness highlights the growing risks to external financing and inflation outlook. The larger current account deficit financed mainly by
Our estimates suggest that last year's failed coup attempt has reduced output by as much as 4%. The recovery has been very strong, however, mainly due
The central bank kept its key lending rates unchanged on June 15.' The expected Fed tightening through 2018 will likely reduce global risk appetite fo
Strong real GDP growth in 2017Q1 was in line with our above-consensus estimate.' Growth was fueled mainly by temporary tax cuts, with private consumpt