Turkey's President Recep Tayyip Erdogan is convening a meeting of his top security officials for the first time since Friday night's thwarted coup, and has vowed to make an "important" announcement afterward.
Following the National Security Council meeting in Ankara, Erdogan will also gather with ruling AK Party government ministers as well as the full cabinet. A presidential official on Tuesday described the impending statement as designed to boost social cohesion, without elaborating. Deputy Prime Minister Mehmet Ali Simsek said on Twitter that policy steps taken will be "market friendly."
The government's crackdown in reprisal for the coup attempt has been swift and severe. Turkey has detained, suspended, fired or stripped the professional accreditation of around 60,000 people, according to Bloomberg calculations. Erdogan has blamed the military intervention on supporters of U.S.-based religious leader Fethullah Gulen. As that purge extended to the country's academic institutions on Tuesday evening, the lira weakened to within 1 percent of a record low.
Academics including university presidents on Wednesday were barred from traveling abroad until further notice, state-run Anadolu news agency reported, citing the Council of Higher Education. And 245 staff were fired at the Youth and Sports Ministry, it said.
The purges have unsettled Turkey's allies and investors by raising concerns that Erdogan's response may be an overreach that further destabilizes Turkish society and weakens its institutions. Erdogan has been seeking to consolidate power in the presidency since he was elected to that office two years ago, and has indicated he believes the attempted coup vindicates his policies. Late on Tuesday, U.S. President Barack Obama, in a phone call, urged his ally to act in a way that was "consistent with the democratic" values of the Turkish constitution.
Moody's Investor Services said Monday that it's put Turkish debt on review for a possible downgrade from its Baa3 credit rating, already the lowest investment grade, because of the attempted coup and its potential impact on growth. JPMorgan analysts wrote in a note Wednesday that Turkish sovereign bonds worth $7.2 billion are at risk of forced selling if Turkey's ratings are cut to junk.
The lira was trading at 3.03 to the dollar, compared with about 2.90 in the days before the attempted coup. Yields on Turkey's 10-year bonds rose for the fourth day in a row to 10.12 percent.
As the post-coup backlash gathers pace, European leaders have warned Turkey about re-instituting the death penalty, with French President Francois Hollande on Tuesday saying such a move would end Turkey's European Union membership talks. The last executions in Turkey were in the mid-1980s and capital punishment was formally abolished in 2004.
The U.S.-Turkish relationship has been tested by recent events, with officials trading barbs in the last few days about Turkey's request that the U.S. extradite Gulen, who has denied any involvement in the failed putsch. On Tuesday, the defense ministers of the two NATO countries spoke by phone and re-affirmed their commitment to fight Islamic State, the U.S. Defense Department said in a statement.
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