Cyprus now rated two notches below Turkey

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Moody’s Investor Service raised Turkey’s main credit rating to Ba1 from Ba1 on June 20th, leaving it only one notch below the Baa3 investment grade.
The new rating also pushed Turkey two notches ahead of the Republic of Cyprus, which was downgraded to Ba3 from Ba1 on June 13th, pushing Cyprus further into junk territory.
Moody’s first pushed Cyprus into junk status on March 13th, following on from Standard and Poor’s which pushed Cyprus into junk territory (BB+) on January 13th.
One of the main reasons why Turkey was upgraded was because of “increased resilience of Turkey's public finances.”
Moody’s said that “Although the international economic environment has become more challenging and Turkish domestic growth is slowing down, the country's ongoing efforts to reduce its debt burden are unlikely to be significantly affected.”
By contrast, the weakening of public finances combined with the exposure of local banks to Greece have been cited by the rating agencies as reasons for Cyprus’ downgrades.
Reduction of the budget deficit in Turkey has brought the debt to GDP ratio to only 39.4%, compared with more than 70% for Cyprus.