Azernews.Az

By Bloomberg

Turkish stocks jumped the most in more than a week and government bonds rose after the Federal Reserve signaled it will raise interest rates more slowly than previously forecast, boosting demand for riskier assets.

The Borsa Istanbul 100 Index rose 1.9 percent to the highest since March 9 after Fed Chair Janet Yellen suggested policy makers were in no hurry to increase borrowing costs. The yield on the benchmark two-year bond fell 27 basis points to 8.49 percent, the lowest since March 6.

“Yellen’s dovish commentary is just what the doctor ordered for emerging market assets,” Isik Okte, a strategist at Teb Investment in Istanbul, said in an e-mailed note. “Turkish assets, led by inflows to fixed-income benchmarks, are going to be outperformers among emerging-market assets today.”

The lira fell to records this month as prospects for higher U.S. rates heightened concern over the vulnerability of Turkish assets amid government calls for lower domestic borrowing costs. A meeting between central bank Governor Erdem Basci and President Recep Tayyip Erdogan last week spurred optimism politicians will tone down their calls and help slow the lira’s depreciation in 2015.

The lira surged 1.7 percent following the Fed announcement on Wednesday, the most since March 2014, before weakening 1 percent to 2.5949 per dollar at 10:13 a.m. in Istanbul.