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Turkish assets mixed on U.S. debt concerns

Published: Updated:

Turkish assets were mixed on Friday as uncertainty over the U.S. government shutdown weighed on the market and data suggested the lira was undervalued against Turkey's major trading partners.

The lira firmed to 1.9930 to the dollar by 1439 GMT from 2.0045 late on Thursday. The 10-year benchmark bond yield rose to 8.96 percent from 8.92 percent.

But stocks fell, with Istanbul's main share index ending down 0.08 percent at 76,206.97 points, underperforming emerging market peers which were up 0.23 percent.

Turkey's real effective exchange rate, its purchasing power compared to the currencies of its main trade partners, fell to 108.31 in September from 111.5 in August, the central bank said.

Central Bank Governor Erdem Basci has ruled out interest rate hikes to support the lira but has forecast an exchange rate of 1.92 to the dollar by the end of the year, which analysts say corresponds to a real exchange rate of 117.

($1 = 2.0029 Turkish liras)