Turkey: feeling the heat

by: Arjen van Dijkhuizen

We do not expect a general EM crisis following recent bouts of risk aversion, but countries with acute vulnerabilities are being hit hardest. Turkey is a case in point, given social unrest, weak external fundamentals and its approximity to Syria. The central bank had to switch to a tightening mode. We lowered our 2013 growth forecast, from 4 to 3.5%.