Aggressive repricing of Turkish assets Turkish lira and local - - PowerPoint PPT Presentation

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Dec 06, 2023 466 likes •514 views

Aggressive repricing of Turkish assets Turkish lira and local government bonds move in lockstep 6.0 24 Lira per USD Turkish short-term sovereign yield (RHS) 22 5.5 Yield to maturity (%) 20 Spot FX rate 5.0 18 4.5 16 4.0 14 3.5 12

SLIDE 1

Aggressive repricing of Turkish assets

Source: M&G, Bloomberg, 10 August 2018

Turkish lira and local government bonds move in lockstep

BONDVIGILANTES 12 14 16 18 20 22 24 3.5 4.0 4.5 5.0 5.5 6.0 Yield to maturity (%) Spot FX rate Lira per USD Turkish short-term sovereign yield (RHS)

SLIDE 2

EM Currencies: Idiosyncratic tails within a USD rally

Source: Bloomberg, 9 August 2018

11.09 5.21 1.55 1.2 0.6

0.96
1.14
1.69
1.89
2.3
4
2

2 4 6 8 10 12

Mexican Peso Clombian Peso Malaysian Ringgit Peruvian Sol Hong Kong Dollar Tahi Baht Singapore Dollar Romanian Leu Chinese Rinminbi Taiwanese Dollar

Best YTD Total Returns vs USD (%)

2.95
3.1
3.24
3.51
4.52
4.57
6.21
9.4
9.41
20.31
23.5
25
20
15
10
5

Philippine Peso Czech Koruna Indian Rupee South Korean Won Polish Zloty South African Rand Hungarian Forint Russian Ruble Brazilian Real Argentine Peso Turkish Lira

Worst YTD Total Returns vs USD (%) BONDVIGILANTES

SLIDE 3

European banks feel Turkish pressure

Source: M&G, Bloomberg, 10 August 2018

Banks’ contingent convertible spreads jump wider

BONDVIGILANTES 200 300 400 500 600 700 Z-spread (bps) BBVA Co-Cos UniCredit Co-Cos