FLASH
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The defeat of Recep Tayyip Erdogan in the local elections has weakened the Turkish lira even more. The Turkish president suffered a heavy defeat, losing control of major cities, including Istanbul and Ankara.
The lira fell 0.2 percent to 32.4328 per dollar. The currency has lost about 9% of its value so far this year.
Ahead of Sunday's vote, investors expressed concern over whether a ruling party loss could prompt changes in economic policy from last year.
"Erdogan's loss in local elections should not disrupt macroeconomic policy. If fears about the economy and inflation in particular are largely responsible for the outcome, then “managing inflation is now a political and economic priority. This should support the improvement of the policy course in the short term ," said Hasnain Malik, a strategic analyst at Tellimer.
Investors have welcomed the shift to a more orthodox monetary policy aimed at taming inflation, even as it weighs on the outlook for economic growth, making borrowing almost impossible for most citizens.
Since the policy shift that followed last year's presidential election, foreign investors have bought a net $4.9 billion in Turkish bonds and stocks.
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