In a widely expected and almost inevitable move, Moody’s downgraded Turkey’s sovereign rating by one notch to Ba1 (junk level) on Friday, quoting the increase in the risks related the country’s external funding requirements and the weakening in previously supportive credit fundamentals, particularly growth and institutional strength as the driver of the decision. Turkey is now only rated at IG only by Fitch, who already lowered the outlook on its rating to negative last month.

Rating downgrade...