The Central Bank of Turkey's Inflation Report, published in July, said lower yields in government bond markets had improved conditions in credit markets.

The report said despite the increase in risk premiums during the second quarter of 2010, a decline in inflation and strengthening expectations that policy rates will stay low for a long period meant longer-term market interest rates continued on a downward trend, and the yield curve flattened out. The spread between 4-year and 6-month paper