Türkiye’s CDS falls to lowest level in 6.5 months
Türkiye’s five-year credit default swap (CDS), a key measure of sovereign risk, fell to 217 basis points, its lowest level since Feb. 18, as expectations of easing geopolitical tensions in the Middle East and recent domestic liquidity management steps improved market sentiment.
Optimism over a possible reduction in regional risks increased after reports suggested the United States was preparing to return diplomats to embassies evacuated during tensions with Iran, while mediator countries indicated negotiations between the parties could resume. Expectations that diplomatic contacts between Washington and Tehran could restart also contributed to a decline in risk perceptions.
The developments eased concerns over global energy supplies and pushed oil prices lower. The drop in oil prices helped alleviate inflation worries and supported a decline in U.S. Treasury yields.
At home, the Central Bank said it would resume one-week repo auctions, which had been suspended since March 1, 2026, as part of its Turkish lira liquidity management framework. Markets interpreted the move as a signal of a return to a more conventional liquidity management structure.
