Moody’s has downgraded Turkey’s credit rating to “junk” status, in a further blow to an economy shaken by terrorist attacks, a failed military coup and a diplomatic spat with Russia.
The rating agency lowered Turkey’s debt one notch, stripping it of investment-grade status.
The move could mean higher borrowing costs as investors demand steeper interest rates to take on riskier Turkish debt.
Moody’s indicated it expects Turkey’s economic growth to be hit by political turmoil following July’s coup attempt that could scare off vital foreign investment and stall economic reforms.
It also cited the impact on the country’s tourism industry from a string of extremist attacks and a row over Turkey’s downing of a Russian warplane last year that has kept Russian visitors away.