Turkey Sells 161-,273-Day T-Bills Yielding 57.10%, 59.61%

The disappointing auction results reflect market worries about a possible war in Iraq, and populist policies recently adopted by the government that contradict its commitments to the International Monetary Fund.
Market participants expect that any war with Iraq would mean fighting on Turkey’s southern border, which would push interest rates up and weaken the lira.
After the auction results, the already weak stock market and the lira fell. In the secondary bond market, annual interest rates rose to 58%-59%, approaching the 60% resistance level.
Around 1200 GMT, the dollar was at 1,680,000, up from TRL1,665,000 Monday. Market participants peg support at TRL1,700,000, the level at which the central bank previously intervened.
The IMKB-100 share index is at 9776 points, down 5.6% on the day, after falling through support at 9800.
-By Selim Atalay, Dow Jones Newswires; +90 212 231 3355; [email protected]