ISTANBUL (Reuters) – Turkey’s lira currency rose sharply yesterday, tracking gains on overseas markets amid optimism that the US Federal Reserve will cut interest rates next week, but Turkish shares nudged lower. The lira was best bid at 1.2770 against the dollar at the close of trade, up 1.17 percent on the day. The lira’s very high yield attracts investors who fund their trades by borrowing low-yielding yen in so-called carry trades. The lira has now gained 10.52 percent against the dollar since the start of the year. Istanbul’s main share index ended down 0.13 percent at 49,233.05 points. “The markets are pricing in the expectation that the Fed will embark on more aggressive rate cutting and this is also a cause of the dollar’s depreciation,” said Simon Quijano-Evans, director of research at Unicredit MIB. Data released after the market close yesterday showed Turkey’s current account deficit widened 25 percent year-on-year in July to $2.218 billion, but this was less than expected.

BRUSSELS (Reuters) – EU veterinary experts agreed yesterday to lift a ban on Bulgarian milk and meat exports into the bloc, but warned Sofia it faces more curbs if it fails to meet the bloc’s food safety standards by the end of 2009. “Progress has now been made in Bulgaria’s implementation of EU control rules, and therefore the restrictive measure will now be repealed,” the European Commission said in a statement. “Bulgarian milk and meat establishments will be given until the end of 2009 to upgrade to EU structural standards.” But EU experts recommended a ban on raw milk products from Bulgaria until further notice.

Lloyd’s Register said in a statement it was setting up Hellenic Lloyd’s, marking a new phase of strategic investment to further consolidate and increase its leading position in the Greek market. According to the plan, a significant number of Greek technical and support staff will join Hellenic Lloyd’s to increase both the capacity and technical capability of the Piraeus office. “As a consequence of the ever-increasing importance of Greece in the global maritime arena, we have determined the need to expand and further optimize our services in Greece and Cyprus,” said Lloyd’s Register Chairman David Moorhouse.

Italian aerospace and defense company Finmeccanica said on Tuesday it had finalized a deal to supply 51 combat helicopters to Turkey for about 1.2 billion euros, after winning a tender for the project in March. The A129 helicopters will be used as part of Ankara’s military modernization program and will be produced in Turkey. (Reuters)

Bulgarian consumer price inflation raced to 12 percent year-on-year in August, after jumping to 8.4 percent the previous month, the statistics office data showed yesterday. The government has forecast year-end inflation at 3.4 percent but analysts believe it will be above 7 percent. (Reuters)