ISTANBUL: The Turkish lira traded near its one-week low on Monday, weighed down by political uncertainty after last week's presidential election and ongoing tension between Russia and Ukraine.
Moody's said in a statement on Friday the presidential election was unlikely to resolve its key economic and institutional credit challenges, because political uncertainty will persist until a general elections due by June 2015.
Investors are waiting for Turkish president-elect Tayyip Erdogan's announcement of his new prime minister this Thursday following a meeting of his ruling AK Party's senior leadership.
"Aside from the prime minister, markets will also closely follow whether their two favourite cabinet ministers, Ali Babacan and Mehmet Simsek, will retain their posts in the new cabinet," Finansbank economist Deniz Cicek said in a note.
Reporters late on Friday that Ukrainian forces had destroyed a Russian military column in Ukrainian territory initially hit markets.
Risk appetite was subdued as the four-month conflict reached a critical phase over the weekend. Kiev and Western governments were watching to see if Russia would intervene to support besieged rebels in eastern Ukraine.
The lira was trading at 2.1685 by 0712 GMT, compared with its one-week low of 2.1718 late on Friday.
Istanbul's main share index was trading 0.35 percent higher at 76,973.37 points, outperforming the broader emerging markets index, which was down 0.01 percent.
The benchmark two-year government bond yield closed at 9.36 percent on Friday. There was no trade in the two-year bond as of 0714 GMT.
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