the Turkish bond yields fell to a record low on expectations

the Turkish bond yields fell to a record low on expectations that the central bank reduced the benchmark interest rate.

benchmark yields two-year bond fell to 11 basis points to 7.33 percent and stood at 7.36 percent at 10:12 am in Istanbul.

Yields have fallen from 7.69 percent since December 12 Deputy Central Bank, Erdem Basci said the bank could cut the repo rate than a week to limit the current account deficit. The committee of central bank monetary policy, which has kept its benchmark rate by 7 percent over a year, holds its next rate meeting on December 16.

"The rate cut expectations have created very serious moves in bonds and currency," said Cem Tozge, a fund manager based in Istanbul Ata Yatirim Mengul Degerler as stated in a telephone interview.

Basci made his proposal in an article published this weekend in the central bank's website. He also called for higher reserve requirements for banks to curb lending for consumption.

The lira gained 0.3 percent to 1.5017 per dollar at 10:15 am in Istanbul.

A 50 basis point rate cut by the central bank can not deter investors from buying bonds and the Turkish currency, said Ercan Uysal, director of research at Standard Unlu Menkul Degerler.

An index of 6.5 percent is greater than 0 percent, "Uysal said in a telephone interview, referring to low interest rates in developed economies.