What matters on Friday, March 25

Turkey is using the power of the Montreux Convention to reduce tension in the Russia-Ukraine war, according to President Recep Tayyip Erdogan. Speaking after the NATO leaders’ summit, President Erdogan said the government will continue to hold talks with Ukrainian President Volodymyr Zelensky and Russian President Vladimir Putin. Addressing NATO members, Erdogan added: “It is in our common interest that the restrictions imposed by some of our allies on the Turkish defense industry be lifted.”

French President Emmanuel Macron said Thursday his government will work with President Recep Tayyip Erdogan for a cease-fire and an agreement for “lasting peace” in Ukraine. Speaking at a news conference in Brussels following the NATO and G7 leaders’ summit, Macron said Erdogan and he have the ‘same perspective’ on the Russia-Ukraine war. The two leaders also agreed to a joint humanitarian operation in Ukraine, especially in the city of Mariupol. Regional issues were also discussed with Erdogan, Macron added, noting that the current situation is an opportunity to eliminate and clarify uncertainties with Turkey. Progress can be made in issues where there was a difference of opinion with Turkey in the past years, Macron also said, adding that a strategy based on cooperation on Libya and the Middle East could be redefined.

The Central Bank Governor Sahap Kavcioglu held the first investors’ meeting of the year. Analysts who attended the meeting found the Central Bank very optimistic and pointed out in questions that the course of inflation is similar to the 1990s. Kavcioglu said the Central Bank didn’t have a structure to finance the public deficit in the 1990s, now this is not the case and the course of inflation doesn’t look like the 1990s. “Obviously we have concerns over inflation. But we think that inflation doesn’t and will not have inertia. Our research shows this,” Kavcioglu added. The Central Bank Governor also stated that inflation will evolve on the path defined by the Central Bank after temporary factors (risks such as commodity and energy) disappear. It was also said at the meeting that inflation will decline towards the end of the year and approach single-digit levels next year.

A USD 300m tech fund was announced jointly by the Turkey Wealth Fund (TWF) and Abu Dhabi Developmental Holding Company PJSC (ADQ). Aiming to grow Turkey’s technology ecosystem, the fund is “the first step for the TWF to establish a broader USD 1bn technology platform, according to a press release by the TWF.


The Capacity Utilization Rate (CUR) in the manufacturing industry increased by 0.7 points to %77.3 in March month-over-month, according to the Central Bank.

The Real Sector Confidence Index (RSCI) dropped by 1.3 points to 108.5 in March, compared to the previous month, according to the Central Bank.

The seasonally adjusted confidence index declined by 6.2% in the services sector, 3.1% in the retail trade sector and 2.0% in the construction sector in March month-over-month, according to the Turkish Statistical Institute (TurkStat).

President Recep Tayyip Erdogan will attend the inauguration of the Tokat Airport and other finished projects (3.30 pm).


>> The total amount in FX-protected TRY deposit accounts rose from TRY 561.8bn to TRY 581.1bn in the week ending on March 18, compared to the previous week, according to the Banking Regulation and Supervision Agency (BDDK).

>> Foreign investors’ net equity, government debt securities (GDS), and corporate bond outflow from Turkey amounted to USD 197.3m, USD 15.9m, and USD 3.1m, respectively, in the week ending on March 18, according to the Central Bank.

>> The Central Bank’s international net reserves rose by USD 1.33bn to USD 17.19bn in the week ending on March 18, compared to the previous week. The bank’s total reserves decreased by USD 156m from USD 108.7bn in the same period.

>> The loan volume of the banking sector increased by TRY 39.8bn to TRY 398.4bn in the week ending on March 18, compared to the previous week, according to the BDDK.

>> Non-performing loans surged by TRY 200m to TRY 163.89bn in the week ending on March 18, compared to the previous week, according to the BDDK.

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