Political Turmoil in Turkey: Financial Markets Brace for Key Court Ruling

Turkey's financial markets are on edge as they anticipate a court ruling on Monday that could lead to the ousting of the main opposition party leader. This development comes after a period of significant political turbulence that has impacted Turkish stocks, bonds, and the currency, the lira.

The ruling is part of a broader legal action against opponents of President Tayyip Erdogan, commencing with the March arrest of Istanbul Mayor Ekrem Imamoglu, a key political adversary. This move resulted in a considerable selloff in Turkey's financial markets, prompting renewed scrutiny of this emerging market economy, which had been recovering some of its lost foreign investments.

Turkey's central bank and its policy decisions remain focal points amid this turmoil. Following Imamoglu's arrest, the central bank undertook significant measures to stabilize the financial situation, including selling foreign reserves to support the lira and adjusting interest rates. Industry analysts highlight the potential for the political uncertainty to further influence market dynamics.

(With inputs from agencies.)