22:30 - 17.06.2026
June 17, Fineko/abc.az. Spanish banking giant BBVA maintains its positive outlook on Turkey’s sovereign Eurobonds, noting a fundamental transition in the asset class's underlying investment narrative from a pure "recovery play" into a sustainable "carry and normalization" story.
According to ABC.AZ, BBVA Emerging Markets Strategist Tufan Comert highlighted that while the post-ceasefire US-Iran de-escalation, tumbling oil prices, and improved global risk appetite swiftly boosted Turkish Eurobonds, Turkish debt instruments had already recouped the bulk of their conflict-driven underperformance well before geopolitical tensions officially began to thaw.
Core Strategic Insights from the BBVA Note:
Domestic Demand Buffers Foreign Caution: The recent performance is not an aggressive pricing of imminent credit rating upgrades by foreign funds, but rather a reflection of robust domestic institutional demand coupled with historically lean foreign investor positioning. The gradual foreign re-entry into Turkish debt was abruptly halted in March 2025 following the arrest of Istanbul Mayor Ekrem Imamoglu, which triggered a sweeping re-assessment of Turkey's political risk premium. Since then, foreign ownership has remained largely flat, leaving domestic buyers to serve as the market’s primary backstop.
Global vs. Domestic Drivers: The post-ceasefire rally is broad-based across emerging markets due to falling energy inputs, rather than being uniquely isolated to Turkey. Moving forward, BBVA expects global investors to closely monitor domestic operational variables, including the continuity of the current orthodox economic program, current account balances, FX reserve accumulation velocity, and localized political developments.
