'Turkey's credit rating has been slashed further into "junk" by both Moody's and S&P Global Ratings as the lira exhibited "extreme volatility" and as policy-making in the country became less predictable.
S&P cut the country's long-term local currency rating to BB-, four notches below investment grade, and reduced its long-term foreign currency sovereign credit rating by one notch to a B+.
Moody's, meanwhile, downgraded Turkey's long-term issuer ratings to Ba3 from Ba2 and changed its ratings outlook to negative.
It said "the key driver for today's downgrade is the continuing weakening of Turkey's public institutions and the related reduction in the predictability of Turkish policy making".
"That weakening is exemplified by heightened concerns over the independence of the central bank, and by the lack of a clear and credible plan to address the underlying causes of the recent financial distress, notwithstanding recent statements by the government.
"The tighter financial conditions and weaker exchange rate, associated with high and rising external financing risks, are likely to fuel inflation further and undermine growth, and the risk of a balance of payments crisis continues to rise."
The downgrades came as the Turkish lira continued to slide against the dollar, having lost around 40pc of its value this year alone.
The sell-off has come amid both a debt crisis and a political showdown with Washington, which could result in Turkey facing substantial tariff hikes.'
Read more: Turkey's credit rating slashed by US elite-controlled 'credit agencies' amid lira's 'extreme volatility' (the US targeting of Turkey)
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