Turkish central bank officials have rolled out emergency measures to stem a deepening financial crisis as nationwide protests over the detention of Istanbul Mayor Ekrem Imamoglu enter their fifth day. The unrest has rattled investors, sending the lira plunging to a historic low of 42 against the US dollar and triggering a 6.8% crash in the BIST 100 index—its steepest single-day decline in three years.
Authorities announced restrictions on short-selling and relaxed rules for corporate share buybacks in a bid to stabilize equities. However, long-term government borrowing costs surged to decade highs, signaling lingering skepticism among international markets.
Protests erupted after Imamoglu, a leading opposition figure and potential presidential contender, was jailed on corruption charges. His Republican People's Party (CHP) had recently endorsed him to challenge President Recep Tayyip Erdogan in 2028 elections. Analysts warn the political friction could exacerbate Turkey's economic challenges, including inflation and currency volatility.
While markets briefly stabilized following trading suspensions, analysts caution that lasting recovery hinges on political resolution. 'Investors are watching whether institutions can restore confidence amid overlapping economic and governance pressures,' said one Istanbul-based economist.
