Published on Thursday, February 6, 2020 | Updated on Thursday, February 6, 2020

Turkey Economic Outlook. First quarter 2020

Recent policy impulses could support the acceleration in the economic activity further. We upgrade our GDP growth to 0.8% and 4% for 2019 & 2020 respectively with a higher support from Domestic Demand.

Key points

  • Key points:
  • Turkey’s recovery is accelerating. Some moderation in consumption, more signals on investment to catch-up.
  • Temporary rise in inflation in 1Q20. We expect inflation to be 8.5% by end 2020 unless geopolitical shocks arise.
  • Economic policies will be more supportive. The CBRT may continue to reduce policy rate to one digit at the end of 2020.
  • We expect Fiscal Policy to be neutral with a Budget Deficit to GDP at near 3% in 2020.
  • Complacency should be ruled out as lower than expected growth can trigger policy slippages.

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