Turkey got closer to economic meltdown, Bloomberg reports. Ahead of President Erdogan’s public speech, lira lost 11% falling to new record low level and is ready to show the worst week since 2011.

Government bonds fell and their yields reached historical maximum, as investors lost confidence that state can stop market decline. Now they expect to hear signs of willingness to ease tensions in relations with the US in President’s speech.

In case if central bank does not raise interest rates, lira will continue falling, analytics predict.

Crisis may scare away foreign capital that Turkey needs so much to finance its high external deficit. Besides, companies will have difficulties paying out credit in foreign currency. If lira stays at the same level, inflation will reach 18% by September.

Government reduced forecast of 2018 growth to less than 4% from 5,5%. It is a sign that government is ready to accept more modern growth pace in efforts to balance economy.

Market decline got even worse as ECB expressed concern over exposure of some euro zone banks to Turkey’s assets.