01.02.2025 07:51
The international credit rating agency Fitch Ratings has confirmed Turkey's credit rating as "BB-" with a "stable" outlook. In its statement, the agency announced its year-end interest rate expectation for the Central Bank of the Republic of Turkey (CBRT) as 28%, while also stating its inflation expectation as 32.8%.
Fitch Ratings has announced its assessment of the Turkish economy. In a statement from the credit rating agency, it was reported that Turkey's long-term foreign currency credit rating has been confirmed as "BB-" and the rating outlook as "stable".
INTEREST RATE EXPECTATION AT 28% BY END OF 2025
The statement noted that the Central Bank of the Republic of Turkey (CBRT) has initiated a monetary easing cycle by consecutively reducing interest rates by 250 basis points twice since December of last year, lowering the policy interest rate to 45%, and it is expected that the policy interest rate will decrease to 28% by the end of 2025.
INFLATION EXPECTED TO FALL TO 32.8%
In Fitch's statement, it was recorded that the average annual inflation is projected to decrease significantly from 60.2% in 2024 to 32.8% this year.
RESERVES INCREASED TO 155 BILLION DOLLARS
The statement indicated that international reserves increased by 14 billion dollars to reach 155 billion dollars last year, and the composition has significantly improved. It was expressed that positive real interest rates, low current account deficits, and capital inflows could support the sustainability of improvements in external buffers.
GROWTH COMMENT CAUGHT ATTENTION
The statement mentioned that economic growth is expected to slow to 2.9% in 2024, and due to the continuation of tight monetary policy, significant fiscal consolidation, and moderate minimum wage increases, it is anticipated to remain at 2.6% in 2025. It was noted that the gradual recovery projected in the European Union would support net exports.
FITCH RAISED TURKEY'S CREDIT RATING LAST SEPTEMBER
Fitch Ratings last raised Turkey's credit rating from "B+" to "BB-" in September of last year, while determining the rating outlook as "stable".