International credit rating agency Moody's has upgraded Turkey's sovereign credit rating by two notches from 'B3' to 'B1', Bloomberg reported on the 20th (local time).
This is the first time in 11 years that Moody's has raised Turkey's credit rating since upgrading it from 'Ba1' to 'Baa3' in May 2013. Moody's maintained a 'positive' outlook on Turkey's rating.
Despite the Turkish lira's value plummeting and inflation rising for over a decade, Turkey's unconventional monetary policies, including lowering the benchmark interest rate, worsened the economic crisis and caused the sovereign credit rating to plunge.
After his re-election in May last year, President Recep Tayyip Erdogan replaced the economic team, and the central bank raised the benchmark interest rate, which had remained around 8.5%, to 50% through nine hikes by March this year. As a result, the inflation rate, which once soared to 75%, has shown signs of easing in recent months.
Moody's evaluated Turkey by stating that "governance has improved, including a return to a firm and well-established orthodox monetary policy."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
