Turkiye Unveils New Medium Term Program Towards 2024-2027

October 15, 2024 6:30 PM UTC

Bottom Line: Turkiye announced the Medium-Term Program (MTP) for 2024-2027 on September 5. According to the announcement, the main goal of the program aims to bring inflation down to single digits, and ensure price stability. GDP growth aimed to accelerate to 4% next year, 4.5% in 2026 and 5% in 202

EMEA Outlook: Rate Cuts Loading in 2025

September 25, 2024 7:00 AM UTC

·     In Turkiye, we still foresee upside risks emanating from buoyant domestic demand, the stickiness of services inflation, and adverse geopolitical impacts leading average inflation to stand at 58.8% and 35.3% in 2024 and 2025, respectively. We think Central Bank of Republic of Turkiye (CBRT

No Surprises as CBRT Continued to Hold Key Rate Stable at 50% on September 19

September 19, 2024 1:11 PM UTC

Bottom Line: As predictions were centred around no change, Central Bank of Turkiye (CBRT) kept the policy rate stable at 50% for the sixth consecutive month on September 19. CBRT reiterated in a statement that tight monetary stance will be maintained until a significant and sustained decline in the

CBRT Remains Cautious Holding Key Rate at 50% Despite Recent Fall in Inflation

August 29, 2024 10:24 AM UTC

Bottom Line: Central Bank of Turkiye (CBRT) recently released its summary of the Monetary Policy Committee (MPC) meeting after keeping the policy rate stable at 50% on August 20. CBRT said in its summary that tight monetary stance will be maintained until a significant and sustained decline in the u

CBRT Continued to Keep Key Rate Stable at 50%

July 23, 2024 1:48 PM UTC

Bottom Line: As predictions were centred around no change, Central Bank of Turkiye (CBRT) kept the policy rate stable at 50% on July 23. CBRT said in a statement that tight monetary stance will be maintained until a significant and sustained decline in the underlying trend of monthly inflation is ob

As Widely Expected, CBRT Kept Key Rate Stable at 50% on June 27

June 27, 2024 12:32 PM UTC

Bottom Line: As predictions were centred around no change, Central Bank of Turkiye (CBRT) kept the policy rate stable at 50% on June 27 despite galloping inflation edged up to 75.5% in May, up from 69.8% in April. CBRT said in a statement on June 27 that "(…) the tight monetary stance will be main

As Expected, CBRT Kept Key Rate Unchanged at 50%

May 23, 2024 7:30 PM UTC

Bottom Line: As predictions were centred around no change, Central Bank of Turkiye (CBRT) kept the policy rate stable at 50% on May 23 despite galloping inflation which edged up to 69.8% in April, up from 68.5% in March. CBRT said in a statement on May 23 that "(...)considering the lagged effects of

CBRT Kept Key Rate Unchanged at 50%

April 25, 2024 3:25 PM UTC

Bottom Line: As predictions were centred around no change, Central Bank of Turkiye (CBRT) kept the policy rate stable at 50% on April 25 despite galloping inflation, and pressure on FX lately. According to the CBRT statement, monetary policy stance will be tightened in case a significant and persist

EMEA Outlook: Elections Set the Scene in Q2

March 25, 2024 2:00 PM UTC

·     Unlike South Africa and Russia, Turkiye continued with tightening monetary policy in Q1 due to stubborn inflation, pressure on FX and reserves. Meanwhile, Russia and South Africa halted their tightening cycles as of 2024 and will likely start cutting interest rates in Q3 depending on how

Inflationary Pressures Caused CBRT to Restart Tightening Cycle and Hike Key Rate to 50%

March 21, 2024 4:26 PM UTC

Bottom Line: Despite predictions were centred around no change, Central Bank of Turkiye (CBRT) increased the policy rate by 500 bps to 50% on March 21 due to strong inflation, and pressure on FX and reserves lately. According to the CBRT statement, the current level of the policy rate will be mainta

CBRT Left the Key Rate Constant at 45%

February 22, 2024 12:53 PM UTC

Bottom Line: As we predicted, Central Bank of Turkiye (CBRT) ended monetary hiking cycle under new governor, and kept the key rate stable at 45% after eighth straight rate hikes since presidential elections last May. According to the CBRT statement, the current level of the policy rate will be maint

CBRT Started the New Year with a 250 bps Rate Hike

January 25, 2024 11:52 AM UTC

Bottom Line: As we pencilled a 250 bps policy rate hike by Central Bank of Turkiye (CBRT) on January 25 MPC meeting, CBRT continued its monetary tightening cycle by lifting the key rate from 42.5% to 45%. This is the eighth straight rate hike by CBRT since May presidential elections, simply to fight

CBRT Continued Monetary Tightening Cycle on December 21, but with a Lesser Pace

December 21, 2023 12:19 PM UTC

Figure 1: CPI (YoY, % Change) and Policy Rate (%), January 2021 – December 2023
Source: Turkish Statistical Institute, Datastream, Continuum Economics
The CBRT raised the policy rate from 40% to 42.5% on December 21 MPC meeting to establish the disinflation course as soon as possible, to anchor infl

EMEA Outlook: Inflationary Pressures Remain Strong

December 18, 2023 10:01 AM UTC

Our Forecasts
Source: Continuum Economics
Risks to Our Views
Source: Continuum Economics
EMEA Dynamics:  Inflationary Concerns Remain High
EMEA economies continue to be squeezed by macroeconomic problems such as elevated inflation and financial pressures. We think country specific factors, geopolitics,

Moderate Increase in Turkiye’s Inflation in November

December 4, 2023 11:28 AM UTC

Figure 1: CPI (YoY, % Change) and Policy Rate (%), January 2021 – November 2023
Source: Turkish Statistical Institute, Datastream, Continuum Economics
When annual rate of changes (%) in the CPI's main groups are examined in November, we see that housing with 37.5% was the main group with the lowest

Turkish Economy Expands 5.9% in Q3 2023

November 30, 2023 1:40 PM UTC

Figure 1: GDP (%, YoY), Q3 2019 – Q3 2023
Source: Datastream, Continuum Economics
When the activities which constitute GDP are analyzed in Q3, construction sector made the highest contribution to the economy with an 8.1% YoY rise, followed by 5.7% in the industry sector and 5.1% in the financial and

Sixth Straight Rate Hike: CBRT Continued Strong Monetary Tightening

November 23, 2023 12:53 PM UTC

Figure 1: Key Rate (%), September 2020 – November 2023
Source: Datastream
The CBRT raised the policy rate from 35% to 40% on November 23 MPC meeting to establish the disinflation course as soon as possible, to anchor inflation expectations, to control the deterioration in pricing behaviour and to s

Turkiye: Macroeconomic Problems to Limit Long Term Growth

November 10, 2023 10:01 AM UTC

Figure 1: Turkiye GDP Growth Forecasts to 2030 (%) 
Source: Continuum Economics/Datastream
A number of forces impact our long-term growth forecast for Turkiye. 
Figure 2: Turkiye 15+ Population Forecasts to 2030 (Thousand) 
Source: Continuum Economics/Datastream
Figure 3: Turkiye Capacity Utilization

Turkish Inflation Continued Its Spiking Cycle in October

November 3, 2023 8:08 AM UTC

Figure 1: Inflation (YoY, % Change), October 2018 – October 2023
Source: Turkish Statistical Institute, Datastream, Continuum Economics
When annual rate of changes (%) in the CPI’s main groups are examined in October, we see that housing with 25.9% was the main group with the lowest annual increas

CBR Maintains Strong Hawkish Stance by Lifting the Rate to 15%

October 27, 2023 1:34 PM UTC

Figure 1: $/Ruble, October 2022 - October 2023
Source: Datastream
According to the Monetary Policy press release by the CBR today, CBR remained concerned about multiple issues such as higher inflationary pressure seen across an increasingly broader range of goods and services, growing domestic dema

CBRT Continued Strong Monetary Tightening on October 26 MPC

October 26, 2023 3:35 PM UTC

Figure 1: Key Rate (%), September 2020 – October 2023
Source: Datastream 
The CBRT raised the policy rate from 30% to 35% on October 26 MPC meeting to establish the disinflation course as soon as possible, to anchor inflation expectations, to control the deterioration in pricing behaviour and to s