ISTANBUL (Reuters) - In an unexpected move, Standard & Poor's cut its sovereign debt rating on Turkey further into junk territory on Tuesday, citing widening concern about the outlook for inflation amid a sell-off in the lira currency.
S&P said the ratings decision - it cut to "BB-/B" from "BB/B" - was not part of its regularly scheduled reviews of Turkey, reflecting what it said were growing concerns.
"The downgrade reflects our concerns over a deteriorating inflation outlook and the long-term depreciation and volatility of Turkey's exchange rate," it said in a statement.
"The rating action also reflects our concerns over Turkey's deteriorating external position and rising distress in the externally leveraged private sector."