Turkey, our favorite undervalued emerging market, was up just under 1% in local and foreign currency terms this morning. A sharp turnaround in Turkish economic growth from near-recession last year to a 5% p. a. rate of GDP growth during the 1st quarter helped.
Asia Unhedged analyzed Turkish business lending last week and concluded that strong credit growth during Q2 probably portends a continued strong rate of GDP growth.
The Financial Times writes, “After dropping to an all-time low amid economic worries, terrorist threats and political worries at the start of the year, recent stability and signs of an economic improvement have seen it reverse all of its losses for the year. Now, with its emerging markets peers facing political tensions and macroeconomic issues of their own, Turkey is becoming the favoured spot for yield-hungry traders looking to take advantage of its high interest rates.”