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The international credit rating agency Moody's released a statement on August 17 and announced that it has "downgraded the Government of Turkey's long-term issuer ratings to Ba3 from Ba2." It has also changed the rating outlook of the country to negative.
In its statement, the Moody's referred to "the continuing weakening of Turkey's public institutions and the related reduction in the predictability of Turkish policy making" as "the key driver" for the downgrade.
S&P has also lowered Turkey's credit rating
Another international credit rating agency Standard & Poor's (S&P) also issued a statement on the same day and announced that it has lowered Turkey's long-term foreign currency sovereign credit rating to B+ from BB- with a stable outlook.
In its statement, the S&P said, "The downgrade reflects our expectation that the extreme volatility of the Turkish lira and the resulting projected sharp balance of payments adjustment will undermine Turkey's economy. We forecast a recession next year."
The statement also added, "Despite heightened economic risks, we believe the policy response from Turkey's monetary and fiscal authorities has so far been limited."
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