macroeconomics latest publications

October 10, 2017

Turkey: Credit Shock & the Economy

Since the implementation of the Credit Guarantee Fund (KGF) last March, it has provided some extra GDP growth through both the increase in supply and demand of credit, but it will also have side effects. In this watch, we use a Sign Restrictions SVAR model to disentangle the effects of the KGF on the economy from both suppl…

August 1, 2017

Turkey | Monthly Economic Monitor - July 2017

Robust stance in the economic activity continued in 2Q, according to our nowcast. Inflation will ease further in summer on top of favorable base effects before climbing up again in 3Q. The CBRT strengthened its hawkish stance by keeping its interest rates intact and having the average funding rate hover above 11.9%.

July 4, 2017

Turkey Monthly Economic Monitor | June

Recovery in IP continues with the support from both exporting and domestic demand oriented sectors. We expect the GDP growth in 2Q to accelerate even further, as early signals from May suggest a growth rate close to 6%. Turkish lira stabilized at 3.50-3.55 band as global and local factors balance each other and the CBRT m…

June 5, 2017

Turkey Inflation: Worst is over but it’s early for complacency

Annual consumer inflation marginally fell for the first time after 6 months to 11.7% from 11.9% in April. Core inflation remained stable at 9.4% despite the ongoing exchange rate pass-through. We expect the headline to fall towards 11-11.5% band in June and remain at double digits before falling to 9% at the year-end.

July 19, 2016

Turkey | A modest move as expected

The Central Bank reduced the upper bound of its interest rate corridor 25bps further to 8.75% and kept the lower bound of the interest rate corridor and the 1-week repo constant at 7.25% and 7.50% respectively. The decision was in line with the analyst expectations which had declined from the previous 50bps to a 25bps reduc…

July 14, 2016

Turkey | Still Robust GDP Growth in 2Q

IP grew by 5.6% (WDA YoY) in May, beating the consensus estimate (4.1%). April-May production and demand side data pointed at a modest slowdown economic activity in 2Q16 especially in ex-auto items, partly confirming the earlier easing signals from the confidence indicators. We expect some moderation ahead but we maintain o…

July 4, 2016

Turkey: Limited Improvement in Core Inflation

Consumer prices rose by 0.5% In June on monthly basis, leading annual inflation to climb to 7.64% from 6.58%. Although the food inflation resulted in a correction as we had already expected, the worrying outlook in the core prices drew a more negative picture. Annual food inflation accelerated to 6.3% from 1.8%, while core …