(Bloomberg) -- Turkey’s highest electoral body nullified the Istanbul municipal election results and called a new vote, as requested by the ruling party of President Recep Tayyip Erdogan, according to ruling AK Party’s election board representative, Recep Ozel.

The High Election Board’s verdict, which is final, came after a vote on whether to nullify the vote based on the ruling party’s allegation that there were widespread irregularities in the March 31 vote, which Erdogan’s candidate lost. The decision fueled concerns about the democratic foundations of Middle East’s largest economy and the prospect of more political turmoil. The lira tumbled, dropping more than 2 percent.

Erdogan’s refusal to concede defeat in the city where he built his political career has been criticized by opponents as a sign of his increasingly authoritarian rule during more than a decade and a half in power. Ekrem Imamoglu of the opposition CHP took the office of Istanbul mayor on April 17.

Imamoglu had defeated AK Party’s Binali Yildirim, a former prime minister, with a slim margin of about 14,000 votes in a city with more than 10 million voters, according to the election board’s initially reported results. After initially claiming victory, the ruling party accepted it trailed the count but said that widespread irregularities tainted the vote and resulted in its loss of control over the country’s biggest city, which has been held by the AKP and its predecessors since 1994.

The lira’s slide against the dollar suggests new turbulence ahead as the government struggles to shore up confidence in the economy and avert a showdown with the U.S. over issues including its purchase of a Russian missile-defense system.

©2019 Bloomberg L.P.