May 1, 2018 / 9:44 PM / a month ago

In unexpected move, S&P cuts Turkey's rating deeper into 'junk'

ISTANBUL (Reuters) - In an unexpected move, Standard & Poor’s cut its sovereign debt rating on Turkey further into junk territory on Tuesday, citing widening concern about the outlook for inflation amid a sell-off in the lira currency.

S&P said the ratings decision - it cut to “BB-/B” from “BB/B” - was not part of its regularly scheduled reviews of Turkey, reflecting what it said were growing concerns.

“The downgrade reflects our concerns over a deteriorating inflation outlook and the long-term depreciation and volatility of Turkey’s exchange rate,” it said in a statement.

“The rating action also reflects our concerns over Turkey’s deteriorating external position and rising distress in the externally leveraged private sector.”

Reporting by David Dolan; Writing by Ali Kucukgocmen; Editing by Peter Graff

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