ISTANBUL: Turkish bond yields rose further on Wednesday on growing expectations the central bank will not cut interest rates next week, while the lira was slightly stronger.
Shares edged higher, slightly outperforming emerging peers.
The yield on the two-year bond inched up to 6.19 percent from Tuesday's close at 6.17 percent. It has risen around 40 basis points since March 13.
"Yesterday's weak debt auctions continue to weigh on the bond market. Plus, the central bank will probably stop cutting its rates. This also pushes yields up," said Yasin Demir, treasury and fixed-income securities manager at Is Investment.
"Global risk aversion is also affecting bonds negatively," Demir added.
Turkey borrowed 3.88 billion lira ($2 bln) through two debt auctions at a higher yield than expected on Tuesday, completing its 9.67 billion lira March borrowing programme.
By 0821 GMT, the lira stood at 1.8215 to the dollar , from 1.8222 late on Tuesday. In early trade on Wednesday the lira hit 1.8270, very close to its weakest level since Sept. 5 of 1.8271.
Against its euro-dollar basket the lira has been weakening since March 6. It eased to 2.0854 on Wednesday from 2.0846 late on Tuesday.
"The weakness in the lira has become more significant after the unsuccessful debt auctions yesterday," wrote Ali Cakiroglu, senior investment strategist at HSBC Asset Management, in a note.
Istanbul's main share index was up 0.6 percent at 82,780 points, outperforming a rise of 0.15 percent in the global emerging markets index.
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