Fitch Ratings' Assessment of the Turkish Economy
Fitch officials stated that the fund crisis will not pose a risk, while sharing year-end inflation and exchange rate forecasts.
Fitch Ratings Senior Director Douglas Winslow evaluated current developments in the Turkish economy, stating that the fund crisis will not constitute a systemic risk and will not affect the credit rating.
Fund Crisis and Credit Rating
Fitch Ratings Senior Director Douglas Winslow discussed the state of the Turkish economy in statements made to London Representative Berfu Güven.
It was pointed out that the difficulties experienced in the fund market contain negativity, but are not of a magnitude that would require a credit rating change.
Resilience Against External Shocks
It was emphasized that the Turkish economy is resilient against external shocks and that the improvement in reserves creates sufficient buffers.
In addition, special attention was drawn to the fact that recent developments have not increased the risk of dollarization.
Inflation and Interest Rate Expectations
It was stated that inflation is expected to drop to 30.5 percent by the end of the year.
It is projected that the Central Bank will maintain its tight stance and may implement a 150 basis point interest rate cut towards the end of the year.
Exchange Rate and Growth
While a gradual real appreciation in the Turkish lira is expected to continue, the year-end USD/TRY forecast was announced as 51 liras.
The institution's USD/TRY forecast for the end of 2027 stands at 60 liras, while the economic growth forecast for 2026 was announced as 3.8 percent.