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(Bloomberg) -- Turkish markets buckled on Wednesday after the detention of President Recep Tayyip Erdogan’s most prominent rival stoked concern a widening political crackdown could see the country’s recent investor-friendly economic policies rolled back.

The lira tumbled to a record low, the nation’s stocks dropped so abruptly they triggered a trading halt, and borrowing costs surged as investors dumped the government’s debt.

The trigger for the sharp moves was the detention early in the morning of 54-year-old Ekrem Imamoglu, the popular mayor of Istanbul and a top contender for the presidency. It served up a reminder of the uncertainty involved in investing in Turkish assets and recalled past crises, when Erdogan’s unorthodox economic policies contributed to sharp selloffs in the lira.

“This is a bit of a shock to the system — the trend, at least recently, has been toward greater stability, whether that be economic or political,” said Nick Rees, the head of macro research at Monex Europe Ltd in London. “But mass arrests of opposition political leaders flies in the face of the trend — markets had become increasingly complacent, and that spell has now been broken, with dramatic results as traders reprice Turkey’s political risk premia.”

Treasury and Finance Minister Mehmet Simsek stepped in to reassure investors, saying that the government’s economy policy remain unchanged. “The economy program we have been implementing continues in a determined fashion,” he said in a comment on X.

Turkish assets posted the biggest losses worldwide: The lira weakened as much as 11% to trade past 40 mark against the US dollar before trimming losses to 5.9% as of 11:07 a.m. in Istanbul. The benchmark Borsa Istanbul 100 Index fell 6.9% at the open and sovereign 10-year bonds tumbled, sending yields 139 basis points higher to 29.58%.

The detention of Imamoglu came a day after Turkish authorities revoked his university diploma in a move that could bar him from challenging Erdogan in the next presidential election. He beat Erdogan’s handpicked candidate in last year’s Istanbul mayoral race and was set on Sunday to be named the presidential candidate for the Republican People’s Party, the main opposition group known as the CHP.

In a voice message shared by his team, Imamoglu denounced his arrest, accusing authorities of weaponizing the police. His party has called the charges baseless and politically motivated.

The moves are part of a broader pressure campaign against opposition figures, activists, and critical voices. Imamoglu’s detention follows the arrest in January of Umit Ozdag, the leader of a small nationalist party and a vocal critic of Erdogan. Investigations have also ensnared national politicians, journalists, and even a celebrity agent earlier this year. Former Kurdish leader Selahattin Demirtas has been imprisoned for years.

The next presidential election is officially set for 2028. For a chance at extending more than two decades in power — as prime minister and then president — Erdogan would need to secure enough parliamentary support to change the constitution or call for a snap election.

(Updates with market moves, quotes throughout.)