Assoc. Prof. Dr. Hakan Bektaş's Evaluation of the MTP: Postponing the Inflation Target Will Increase Pressure

Assoc. Prof. Dr. Hakan Bektaş evaluated the updates in the Medium-Term Program (MTP), stating that postponing the single-digit inflation target to 2029 will prolong the economic pressure on households, reduce purchasing power, and that the borrowing structure carries risks.

MTP Revisions and Inflation Inertia

Stating that the Medium-Term Program is a guide providing predictability for the country's economy, Assoc. Prof. Dr. Hakan Bektaş said that growth was revised downward and inflation upward in the headlines. He recalled that the inflation target was raised to 28.4% and the single-digit target was postponed to 2029.

Households and the Cost of Living

Emphasizing that the citizen's biggest problem is the cost of living, Bektaş stated that when incomes do not increase at the rate of price hikes, a serious affordability problem arises. He stated that households are cutting back on food choices and credit cards have turned into a means of survival.

Labor Force Targets and Opportunities

Touching upon the labor force statistics in the MTP, Bektaş reminded that the idle labor force rate has risen to 30%. He stated that targets such as sharing care responsibilities and opening nurseries to increase women's labor force participation are valuable.

Energy Dependency and External Shocks

Arguing that external shocks will play a critical role in the realizability of MTP targets, Bektaş conveyed that energy dependency, geopolitical risks, and potential increases in LNG and oil prices could negatively affect the current account deficit and budget balance.

Withholding Tax on Money Market Funds

Evaluating the 10% withholding tax introduced on money market funds for institutional investors as of September, Bektaş noted that this move aims to direct hot money toward more permanent and long-term financial instruments.