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Turkey sold $1 billion of 11-year dollar bonds in its first test of investor demand since ending financing talks with the International Monetary Fund. Turkey sold the securities to yield 2.03 percentage points above U.S. Treasuries, according to Bloomberg data. Bank of America Merrill Lynch, Barclays Capital and Royal Bank of Scotland Group Plc managed the offering, the Treasury in Ankara said in a statement on its Web site.

Turkey and the IMF said yesterday they halted almost two years of talks on a possible loan program. Turkey doesn't need IMF funding and has set out a credible economic plan on its own, Deputy Prime Minister Ali Babacan said yesterday. The sale was “a good test for the Treasury to see demand for Turkish borrowing instruments in the absence of a stand-by deal,” Ozgur Altug, chief economist for BGC Partners in Istanbul, wrote in an e-mailed report.

Benchmark two-year Turkish lira bonds fell yesterday, driving yields to a 2010 high, according to an ABN Amro Holding NV index. Yields declined four basis points to 9.22 percent.

The Treasury wants to borrow about $5.6 billion in international capital markets this year to take advantage of lower interest costs as the global economy recovers and the international debt crisis recedes.

Israel sold 1.5 billion euros ($2.1 billion) today in its first offering of euro-denominated bonds since 2005. Romania issued 1 billion euros, in its biggest offering of debt to international investors.

The end of IMF loan talks “doesn't bode well for enhancing market sentiment” as “the external financing outlook still remains tight, with the current-account deficit heading toward $31 billion,” or 4.4 percent of gross domestic product, this year, Citigroup Global Markets analyst Ilker Domac wrote in a research report. Accelerating inflation and a general election in 2011 may also weigh on sentiment as global markets remain “skittish,” Domac wrote.

Turkey sold $2 billion in 30-year bonds on Jan. 5, receiving orders for $7.3 billion. The country's benchmark stock index retreated 0.7 percent.

Ozgur Altug Comments: Turkey Sells $1 Billion Of 11-Year Bonds In Overseas Markets - Businessweek

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