Fund crisis spreads to corporate bonds: 1.1 billion dollars in sales in four weeks

Foreign investors have been continuously selling corporate bonds for four weeks since the fund crisis erupted. According to Central Bank data, a net 480 million dollars in sales occurred in a single week during the week of October 9; the four-week total reached 1.1 billion dollars.

According to the figures, before the crisis the corporate bond market exceeded 1 trillion lira, where foreign investors held the position of the second-largest player with a 17 percent share. The narrowing of liquidity in this market, which includes issuances by real-sector companies led by energy and automotive, could directly affect companies' borrowing and investment decisions.

International reactions are also hardening. British economics magazine The Economist, in its analysis titled "Turkey's Investment Fund Fiasco," wrote that the collapse wiped out 30 billion dollars in market value in two days and emphasized that Turkey's MSCI emerging markets status is at risk. The magazine underscored that market confidence may not be restored through judicial processes alone.

Capital Markets Board Chair Mahmut Sütcü was removed from office in the first month of the crisis; investigations and appointments continue.