ISTANBUL, March 27 The Turkish lira strengthened to its strongest level against the dollar in three weeks on Thursday on foreign inflows triggered by anticipation of a strong showing for the ruling AK Party in local elections on Sunday.
But gains were capped by investor unease after the Turkish telecoms authority TIB said on Thursday it had taken an "administrative measure" against YouTube, a week after it blocked access to microblogging site Twitter, causing international condemnation and market losses.
At 1441 GMT, the lira firmed to its strongest level of the day at 2.1752, from 2.1985 late on Wednesday. After news of action against YouTube broke, it weakened to 2.1877 by 1617 GMT.
After sharp gains on Wednesday, the main Istanbul share index closed down 1.01 percent at 67,048.36, underperforming the main emerging markets index, which was up 0.56 percent.
Turkey's 10-year benchmark bond yield fell to 10.63 percent from 11.8 percent at Wednesday's close. (Reporting by Dasha Afanasieva; Editing by Ece Toksabay)