Fitch's Positive Assessment on Turkey's Credit Rating Outlook

Fitch Senior Executive's Assessment of Turkey

Fitch Emerging Market Director Erich Arispe discussed Turkey's credit rating outlook in an interview with Bloomberg HT.

Changes in Turkey's Credit Rating Outlook

Fitch decided to change Turkey's rating outlook from stable to positive last Friday. Arispe emphasized that this move is reasonable given the current data, recalling that uncertainties such as trade wars have dominated in the past year.

Reserves and Inflation Issues

Arispe stated, "The rise in reserves, the nearing end of the Currency Protected Deposit scheme, and similar factors have renewed confidence. Moreover, serious steps are being taken to balance inflation. All these developments will also reflect on Turkey's credit rating," he said.

Inflation Figures and Policy Expectations

Highlighting that inflation in Turkey is still high compared to similar countries, Arispe mentioned, "There will be an expectation of continuity on the policy side following the decision. The average inflation expectation for this year in Turkey is 27 percent, while in peer countries it is around 3.5 percent. More confidence needs to be built in this regard," he stated.

Expectations for Turkish Assets by 2026

In his assessment of Turkish assets for the year 2026, Arispe expressed that they expect a recovery in the Turkish lira, stating, "However, it should not be forgotten that this is dependent on international policy. In an environment dominated by global uncertainties, Turkey has a need for external markets. Investor appetite for Turkey will shape itself based on many details," he concluded.