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The Second Investment Grade: A Game Changer?

İbrahim Kanlı

CBT Research Notes in Economics from Research and Monetary Policy Department, Central Bank of the Republic of Turkey

Abstract: [EN] This note focuses on the behaviour of portfolio flows and basic financial indicators before and after the acquisition of the second “Investment Grade” (IG) by analysing all relevant cases in the period between 1990 and 2012. Results reveal that portfolio flows into bond and equity markets accelerate prior to the second IG and lose steam afterwards. However, portfolio flows into bond markets tend to reaccelerate in longer-terms. Stock markets perform well above the reference groups’ through the pre-IG period. Meanwhile, reduction in CDS premiums continues even after the second IG, albeit at a lower speed. There also exists some evidence that local bond yields portray a downward trend before and after the second IG. Domestic currency appreciates significantly with respect to the reference group before and after the second IG. [TR] Bu notta, 1990 ve 2012 yillari arasinda “yatirim yapilabilir” seviyede ikinci kredi notuna (YYS) sahip olan ulkelerin finansal degiskenlerinin ve bu ulkelere portfoy akimlarinin izledikleri egilimlere odaklanilmaktadir. Sonuclar ikinci YYS oncesinde tahvil ve hisse senedi piyasalarina portfoy akimlarinin hizlandigini, YYS sonrasi ise akimlarin gucunu kaybettigini gostermektedir. Ne var ki, tahvil piyasasina portfoy akimlari daha uzun donemlerde tekrar guclenme egilimi gostermektedir. Hisse senedi endeksleri YYS oncesinde akran ulke endekslerinin uzerinde performans gostermekte, bu ayrisma YYS sonrasi ortadan kalkmaktadir. CDS oranlari da YYS oncesi gerilemekte, ancak bu egilim daha yavas olmakla birlikte YYS sonrasi da korunmaktadir. Bunun yani sira, yurt ici devlet tahvilleri getirilerinde YYS oncesi ve sonrasinda gerileme egilimine dair guclu olmayan bulgulara ulasilmistir. Kur gerek YYS oncesi gerekse sonrasinda akran ulke para birimlerinin uzerinde performans gostermektedir.

Date: 2013
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