ANKARA: Coalition talks between Turkey's ruling AK Party and the main opposition CHP ended in failure Thursday, senior officials on both sides told Reuters, setting the stage for a snap election later this year and sending Turkish assets tumbling.
Prime Minister Ahmet Davutoglu held a 1.5-hour meeting in Ankara with CHP leader Kemal Kilicdaroglu, a last-ditch effort to agree a grand coalition after weeks of talks between their parties.
"The outcome is negative," a senior CHP official told Reuters by phone, without giving further details.
The AKP could now try to strike a coalition agreement with the nationalist opposition MHP, but a senior ruling party official said the chances of such a deal were "very slim" and that a snap election in November was a high probability.
Davutoglu and the CHP are expected to make statements later.
The lira currency weakened to a record low of 2.82 to the dollar on the news and stocks fell sharply. Many investors had hoped for a deal between the AKP and the pro-business, center-left CHP, and fear another election will serve only to prolong uncertainty.
The AKP failed to win a parliamentary majority in an election on June 7, leaving it unable to govern alone for the first time since it came to power in 2002.
Davutoglu has until Aug. 23 to find a junior coalition partner or President Tayyip Erdogan, who founded the AKP, could call a snap election.
The MHP has said it does not favor a coalition with the ruling party, but has hinted it could support a minority AKP government in the short term in return for a new election.
Erdogan has made clear he favors single-party government in Turkey and has made no secret of his ambition to change the constitution and create an executive presidency, virtually impossible without a strong AKP majority.