The international debt markets are used by Turkey, issuing a new bond to dollarstaking advantage of stronger sentiment towards emerging markets and the easing of political tensions at home.
The new bonds are being marketed around the 7.15% yield range. The performance is roughly in line with Turkey’s existing curve, reflecting continued investment appetite after a court last week dismissed a case against opposition leader Ozgur Ozel, according to Bloomberg.
The 11-year fixed-rate bonds will be issued under the government’s global bond program and are expected to be priced on Monday, the person said. JPMorgan Chase & Co, Morgan Stanley, SMBC Nikko Securities Inc. and Societe Generale SA are arranging the sale. The proceeds will be used for general budgetary purposes.
Investor interest has been boosted by a reduction in political risk after a Turkish court dismissed the case against the opposition leader. The decision sparked a rally in Turkish assets on Friday, with dollar-denominated bonds rising along with stocks.
The deal also adds to a wave of sovereign borrowing in emerging markets as governments seek to secure funding to take advantage of a positive mix of factors. The Federal Reserve’s rate-cutting cycle creates room for central banks in developing countries to ease policy, while a weaker dollar encourages a shift away from US assets. Easing trade tensions between the US and China are further boosting global sentiment.
Dollar-denominated government bonds from developing countries have returned a total of 11% so far this year. Turkish bonds followed suit, posting gains of around 10.5%.