The Turkish economy will grow below the target in the Medium-Term Economic Program (OVP), according to a report by the Economic Policy Research Foundation of Turkey (TEPAV).
“Turkey’s economy will expand by 3.7% this year, 2.9% in 2024 and 3.4% in 2025,” the TEPAV Turkish Economic Outlook report said.
The GDP is estimated to grow by 4.4%, 4%, and 4.5% for 2023,2024,2025, respectively, in line with the OVP.
“The Turkish economy is expected to slow down in the third quarter of 2023 and contract in the last quarter due to rising domestic interest rates and a slowdown in external demand,” the report read.
“Based on the authorities’ economic objectives to reduce inflation and improve financial stability, we expect the Central Bank to hike the policy interest rate up to 40% in 2023 and 45% in 2024,” it added.
Inflation will hit 66% at the year-end 2023, 39% in 2024 and 26% in 2025, in line with the report.
“Our simulations show that the current account deficit will come down to 3.6% of the GDP by the end of 2025 with a moderating in domestic demand,” it noted.
TEPAV Directors and daily EKONOMI Columnists Guven Sak and Fatih Ozatay attended the report launch.
