S&P cuts Turkey's rating deeper into 'junk' in an unexpected move - Reuters

The US-based ratings agency, Standard & Poor’s (S&P) slashed its sovereign debt rating on Turkey further into junk territory late-Tuesday, in an unexpected move, Reuters reports.

S&P said it cut Turkey’s ratings to “BB-/B” from “BB/B”. 

The main reason cited for the ratings downgrade was the widening concern about the outlook for inflation amid a sell-off in the Lira currency.

The statement read: “The downgrade reflects our concerns over a deteriorating inflation outlook and the long-term depreciation and volatility of Turkey’s exchange rate. The rating action also reflects our concerns over Turkey’s deteriorating external position and rising distress in the externally leveraged private sector.”