Turkey had its sovereign credit rating downgraded by Moody’s Investors Service and S&P Global Ratings, as it sinks further into an economic crisis with little clarity from its leadership on how it plans to steer the country out of a turmoil that could push it into recession next year.
Moody’s downgraded the government of Turkey’s long-term issuer ratings to Ba3 from Ba2 and changed its rating outlook to negative on Saturday. Its senior unsecured bond ratings and senior unsecured shelf ratings were also cut to Ba3 and (P)Ba3 respectively.
S&P slashed Turkey’s sovereign credit rating to ‘B+’ from ‘BB-’ but assigned a stable outlook on Friday. The rating agency, citing extreme volatility of the Turkish lira among the reasons for the downgrade said the depreciation of the currency may lead to a balance of payments crisis that could undermine the Turkish economy and lead it into a recession in 2019.
“The key driver for [the] downgrade is the continuing weakening of Turkey’s public institutions and the related reduction in the predictability of Turkish policy making,” Moody’s said in its note.
“That weakening is exemplified by heightened concerns over the independence of the central bank, and the lack of a clear and credible plan to address the underlying causes of the recent financial distress.”
Turkey’s lira has lost more than 40 per cent of its value against the US dollar this year, prompting fears of a sell-off in emerging markets.
"This follows Turkey’s prolonged economic overheating, external leveraging, and policy drift," S&P said. “We now expect the economy will contract by 0.5 per cent in real terms in 2019, underpinned by declining consumption and falling investment.”
Turkey's currency took a 20 per cent hit last Friday after US President Donald Trump announced a doubling of steel and aluminium tariffs on its Nato ally, in retaliation to the continued detention of American pastor Andrew Brunson in Turkey, who has been held since 2016 on charges of plotting a coup attempt against Turkey’s president Recep Tayyip Erdoğan.
The lira rallied on Wednesday after Turkey’s banking regulator took measures to shore up the currency. However, Washington later threatened more economic sanctions unless Turkey frees Mr Brunson.
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Read more:
[ Turkey downgrade 'likely' if it fails to tackle mounting fiscal risks, Moody's says ]
[ The Turkish lira tumbles to 5.86 over threat of more US sanctions ]
[ Turkey escalates US feud by increasing tariffs on products ]
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One of Turkey’s high criminal courts on Friday rejected Mr Brunson’s request to be released from house arrest and permitted to travel abroad, Turkey’s state news agency reported. The lira weakened again to 5.86 against the dollar that day, from a previous close of 5.8150.
The ratings agencies said the persistently volatile lira and wide current account deficit risk undermining the Turkish economy. Moody’s said the tighter financial conditions and weaker exchange rate, associated with high and rising external financing risks, are likely to fuel inflation further and undermine growth, and said the risk of a balance of payments adjustment continues to rise.
Moody's in June placed Turkey's credit rating on review following the downgrade in March to Ba2, two levels below investment grade. Mathias Angonin, a sovereign analyst at Moody's, told The National ahead of the rating action that the agency is likely to downgrade it "if we conclude that policy-making is unlikely to be able to prevent a further deterioration in Turkey's external position".
S&P on Friday said the weakening of the lira is putting pressure on the indebted corporate sector and has considerably increased the funding risk for Turkey’s banks. The policy response from Turkish authorities so far has been “limited”. S&P already rates Turkey’s bonds as ‘junk’, meaning they are considered high-risk investments.
Moody’s on Saturday also lowered Turkey’s long-term country ceilings, including the foreign currency bond ceiling to Ba2 from Baa3; its foreign currency deposit ceiling to B1 from Ba3, and its local currency bond and deposit ceilings to Ba1 from Baa2.
Ceilings generally act as the maximum ratings that can be assigned to a domestic issuer in Turkey.
“The decision to narrow the gap between the ceilings and the government bond rating is informed by Moody’s view of weakening institutional strength,” it said.
How being social media savvy can improve your well being
Next time when procastinating online remember that you can save thousands on paying for a personal trainer and a gym membership simply by watching YouTube videos and keeping up with the latest health tips and trends.
As social media apps are becoming more and more consumed by health experts and nutritionists who are using it to awareness and encourage patients to engage in physical activity.
Elizabeth Watson, a personal trainer from Stay Fit gym in Abu Dhabi suggests that “individuals can use social media as a means of keeping fit, there are a lot of great exercises you can do and train from experts at home just by watching videos on YouTube”.
Norlyn Torrena, a clinical nutritionist from Burjeel Hospital advises her clients to be more technologically active “most of my clients are so engaged with their phones that I advise them to download applications that offer health related services”.
Torrena said that “most people believe that dieting and keeping fit is boring”.
However, by using social media apps keeping fit means that people are “modern and are kept up to date with the latest heath tips and trends”.
“It can be a guide to a healthy lifestyle and exercise if used in the correct way, so I really encourage my clients to download health applications” said Mrs Torrena.
People can also connect with each other and exchange “tips and notes, it’s extremely healthy and fun”.
Padmaavat
Director: Sanjay Leela Bhansali
Starring: Ranveer Singh, Deepika Padukone, Shahid Kapoor, Jim Sarbh
3.5/5
PREMIER LEAGUE FIXTURES
All times UAE (+4 GMT)
Saturday
West Ham United v Tottenham Hotspur (3.30pm)
Burnley v Huddersfield Town (7pm)
Everton v Bournemouth (7pm)
Manchester City v Crystal Palace (7pm)
Southampton v Manchester United (7pm)
Stoke City v Chelsea (7pm)
Swansea City v Watford (7pm)
Leicester City v Liverpool (8.30pm)
Sunday
Brighton and Hove Albion v Newcastle United (7pm)
Monday
Arsenal v West Bromwich Albion (11pm)
ROUTE TO TITLE
Round 1: Beat Leolia Jeanjean 6-1, 6-2
Round 2: Beat Naomi Osaka 7-6, 1-6, 7-5
Round 3: Beat Marie Bouzkova 6-4, 6-2
Round 4: Beat Anastasia Potapova 6-0, 6-0
Quarter-final: Beat Marketa Vondrousova 6-0, 6-2
Semi-final: Beat Coco Gauff 6-2, 6-4
Final: Beat Jasmine Paolini 6-2, 6-2
Company Profile
Company name: Cargoz
Date started: January 2022
Founders: Premlal Pullisserry and Lijo Antony
Based: Dubai
Number of staff: 30
Investment stage: Seed
The Roundup : No Way Out
Director: Lee Sang-yong
Stars: Don Lee, Lee Jun-hyuk, Munetaka Aoki
Rating: 3/5
Naga
Director: Meshal Al Jaser
Starring: Adwa Bader, Yazeed Almajyul, Khalid Bin Shaddad
Rating: 4/5
COMPANY PROFILE
Name: Kinetic 7
Started: 2018
Founder: Rick Parish
Based: Abu Dhabi, UAE
Industry: Clean cooking
Funding: $10 million
Investors: Self-funded
The alternatives
• Founded in 2014, Telr is a payment aggregator and gateway with an office in Silicon Oasis. It’s e-commerce entry plan costs Dh349 monthly (plus VAT). QR codes direct customers to an online payment page and merchants can generate payments through messaging apps.
• Business Bay’s Pallapay claims 40,000-plus active merchants who can invoice customers and receive payment by card. Fees range from 1.99 per cent plus Dh1 per transaction depending on payment method and location, such as online or via UAE mobile.
• Tap started in May 2013 in Kuwait, allowing Middle East businesses to bill, accept, receive and make payments online “easier, faster and smoother” via goSell and goCollect. It supports more than 10,000 merchants. Monthly fees range from US$65-100, plus card charges of 2.75-3.75 per cent and Dh1.2 per sale.
• 2checkout’s “all-in-one payment gateway and merchant account” accepts payments in 200-plus markets for 2.4-3.9 per cent, plus a Dh1.2-Dh1.8 currency conversion charge. The US provider processes online shop and mobile transactions and has 17,000-plus active digital commerce users.
• PayPal is probably the best-known online goods payment method - usually used for eBay purchases - but can be used to receive funds, providing everyone’s signed up. Costs from 2.9 per cent plus Dh1.2 per transaction.
liverpool youngsters
Ki-Jana Hoever
The only one of this squad to have scored for Liverpool, the versatile Dutchman impressed on his debut at Wolves in January. He can play right-back, centre-back or in midfield.
Herbie Kane
Not the most prominent H Kane in English football but a 21-year-old Bristolian who had a fine season on loan at Doncaster last year. He is an all-action midfielder.
Luis Longstaff
Signed from Newcastle but no relation to United’s brothers Sean and Matty, Luis is a winger. An England Under-16 international, he helped Liverpool win the FA Youth Cup last season.
Yasser Larouci
An 18-year-old Algerian-born winger who can also play as a left-back, Larouci did well on Liverpool’s pre-season tour until an awful tackle by a Sevilla player injured him.
Adam Lewis
Steven Gerrard is a fan of his fellow Scouser, who has been on Liverpool’s books since he was in the Under-6s, Lewis was a midfielder, but has been converted into a left-back.
Confirmed bouts (more to be added)
Cory Sandhagen v Umar Nurmagomedov
Nick Diaz v Vicente Luque
Michael Chiesa v Tony Ferguson
Deiveson Figueiredo v Marlon Vera
Mackenzie Dern v Loopy Godinez
Tickets for the August 3 Fight Night, held in partnership with the Department of Culture and Tourism Abu Dhabi, went on sale earlier this month, through www.etihadarena.ae and www.ticketmaster.ae.
UAE currency: the story behind the money in your pockets
The nine articles of the 50-Year Charter
1. Dubai silk road
2. A geo-economic map for Dubai
3. First virtual commercial city
4. A central education file for every citizen
5. A doctor to every citizen
6. Free economic and creative zones in universities
7. Self-sufficiency in Dubai homes
8. Co-operative companies in various sectors
9: Annual growth in philanthropy
SPECS
Engine: 2-litre 4-cylinder petrol (V Class); electric motor with 60kW or 90kW powerpack (EQV)
Power: 233hp (V Class, best option); 204hp (EQV, best option)
Torque: 350Nm (V Class, best option); TBA (EQV)
On sale: Mid-2024
Price: TBA
RESULTS
6pm: Marfa Deira – Conditions (PA) Dh80,000 (Dirt) 1,200m
Winner: Wadheha, Bernardo Pinheiro (jockey), Majed Al Jahouri (trainer)
6.35pm: Dubai Creek – Maiden (TB) Dh82,500 (D) 1,400m
Winner: Barq Al Emarat, Bernardo Pinheiro, Ismail Mohammed
7.10pm: Mina Hamriya – Handicap (TB) Dh95,000 (D) 1,600m
Winner: Tahdeed, Dane O’Neill, Michael Costa
7.45pm: Mina Rashid – Maiden (TB) Dh82,500 (D) 1,900m
Winner: Seyaasi, Xavier Ziani, Salem bin Ghadayer
8.20pm: Al Garhoud Sprint DP World – Listed (TB) Dh132,500 (D) 1,200m
Winner: Mouheeb, Ray Dawson, Michael Costa
8.55pm: Mirdiff Stakes Jebel Ali Port – Conditions (TB) Dh120,000 (D) 1,400m
Winner: Seyouff, Antonio Fresu, Michael Costa
9.30pm: Jebel Ali Free Zone – Handicap (TB) Dh95,000 (D) 2,000m
Winner: Ajuste Fiscal, Jose da Silva, Julio Olascoaga
Five personal finance podcasts from The National
To help you get started, tune into these Pocketful of Dirham episodes
·+
Balance is essential to happiness, health and wealth
·+
What is a portfolio stress test?
·+
What are NFTs and why are auction houses interested?
·+
How gamers are getting rich by earning cryptocurrencies
·+
Should you buy or rent a home in the UAE?
WHAT MACRO FACTORS ARE IMPACTING META TECH MARKETS?
• Looming global slowdown and recession in key economies
• Russia-Ukraine war
• Interest rate hikes and the rising cost of debt servicing
• Oil price volatility
• Persisting inflationary pressures
• Exchange rate fluctuations
• Shortage of labour/skills
• A resurgence of Covid?
Dengue fever symptoms
High fever (40°C/104°F)
Severe headache
Pain behind the eyes
Muscle and joint pains
Nausea
Vomiting
Swollen glands
Rash
How to help
Send “thenational” to the following numbers or call the hotline on: 0502955999
2289 – Dh10
2252 – Dh 50
6025 – Dh20
6027 – Dh 100
6026 – Dh 200
More from Neighbourhood Watch:
A QUIET PLACE
Starring: Lupita Nyong'o, Joseph Quinn, Djimon Hounsou
Director: Michael Sarnoski
Rating: 4/5
THE RESULTS
5pm: Maiden (PA) Dh80,000 1,400m
Winner: Alnawar, Connor Beasley (jockey), Helal Al Alawi (trainer)
5.30pm: Maiden (PA) Dh80,000 1,400m
Winner: Raniah, Noel Garbutt, Ernst Oertel
6pm: Handicap (PA) Dh90,000 2,200m
Winner: Saarookh, Richard Mullen, Ana Mendez
6.30pm: Sheikh Zayed bin Sultan Al Nahyan Jewel Crown (PA) Rated Conditions Dh125,000 1,600m
Winner: RB Torch, Tadhg O’Shea, Eric Lemartinel
7pm: Al Wathba Stallions Cup Handicap Dh70,000 1,600m
Winner: MH Wari, Antonio Fresu, Elise Jeane
7.30pm: Handicap Dh90,000 1,600m
Winner: Mailshot, Royston Ffrench, Salem bin Ghadayer
How to wear a kandura
Dos
- Wear the right fabric for the right season and occasion
- Always ask for the dress code if you don’t know
- Wear a white kandura, white ghutra / shemagh (headwear) and black shoes for work
- Wear 100 per cent cotton under the kandura as most fabrics are polyester
Don’ts
- Wear hamdania for work, always wear a ghutra and agal
- Buy a kandura only based on how it feels; ask questions about the fabric and understand what you are buying
COMPANY PROFILE
Name: Haltia.ai
Started: 2023
Co-founders: Arto Bendiken and Talal Thabet
Based: Dubai, UAE
Industry: AI
Number of employees: 41
Funding: About $1.7 million
Investors: Self, family and friends
Januzaj's club record
Manchester United 50 appearances, 5 goals
Borussia Dortmund (loan) 6 appearances, 0 goals
Sunderland (loan) 25 appearances, 0 goals
Company Profile
Name: HyveGeo
Started: 2023
Founders: Abdulaziz bin Redha, Dr Samsurin Welch, Eva Morales and Dr Harjit Singh
Based: Cambridge and Dubai
Number of employees: 8
Industry: Sustainability & Environment
Funding: $200,000 plus undisclosed grant
Investors: Venture capital and government
Dubai Rugby Sevens
November 30-December 2, at The Sevens, Dubai
Gulf Under 19
Pool A – Abu Dhabi Harlequins, Jumeirah College Tigers, Dubai English Speaking School 1, Gems World Academy
Pool B – British School Al Khubairat, Bahrain Colts, Jumeirah College Lions, Dubai English Speaking School 2
Pool C - Dubai College A, Dubai Sharks, Jumeirah English Speaking School, Al Yasmina
Pool D – Dubai Exiles, Dubai Hurricanes, Al Ain Amblers, Deira International School
The National photo project
Chris Whiteoak, a photographer at The National, spent months taking some of Jacqui Allan's props around the UAE, positioning them perfectly in front of some of the country's most recognisable landmarks. He placed a pirate on Kite Beach, in front of the Burj Al Arab, the Cheshire Cat from Alice in Wonderland at the Burj Khalifa, and brought one of Allan's snails (Freddie, which represents her grandfather) to the Dubai Frame. In Abu Dhabi, a dinosaur went to Al Ain's Jebel Hafeet. And a flamingo was taken all the way to the Hatta Mountains. This special project suitably brings to life the quirky nature of Allan's prop shop (and Allan herself!).
The specs
Engine: 3.0-litre six-cylinder MHEV
Power: 360bhp
Torque: 500Nm
Transmission: eight-speed automatic
Price: from Dh282,870
On sale: now