Turkey completed a $10 billion borrowing program in international markets this year with its first dollar bond sale since President Recep Tayyip Erdogan was reelected in May.
The government sold $2.5 billion of a five-year sukuk, or Islamic notes, on Tuesday at a yield of 8.5%, according to a statement from the Treasury. The yield was 37.5 basis points lower than the initial price guidance.
Erdogan has embarked on a policy overhaul since the elections, taking a more mainstream approach to steering the economy to appeal to investors who’ve abandoned Turkish assets in recent years.
Turkey last tapped the dollar market in April, selling $2.5 billion of green bonds maturing in 2030 and yielding 9.3%. The price has since risen, bringing the yield to about 8.6%.
Read more: The Bond Trade of 2024 in Emerging Markets May Be in Turkey
The latest sale adds to an emerging markets-wide rush to take advantage of lower yields after a rally in benchmark US Treasuries. That’s been caused by many investors predicting the Federal Reserve is finished with interest-rate hikes for this cycle.
Investors from the Middle East made up nearly half of the buyers, the Treasury said on Wednesday, with slightly less than a quarter from the UK and 18% purchased by those in the US.
Turkish officials have also said they would issue a eurobond this year to help fund rebuilding efforts in the country’s southeast after a pair of powerful earthquakes in February.
Abu Dhabi wealth fund ADQ is slated to buy as much as $8.5 billion of bonds that are planned to be issued before the end of this year.
