Moody’s drew attention to the disinflation process in Türkiye.

Moody’s Senior Analyst Alexander Perjessy

Speaking at a major Islamic finance conference held in Istanbul, Moody’s Senior Analyst Alexander Perjessy pointed out that Turkey's disinflation process has noticeably lost momentum. Perjessy noted that core inflation is constrained at around %2 on a monthly basis. This situation has a significant impact on the overall economic outlook.

Domestic Demand Remains Strong

The analyst emphasized that domestic demand in Turkey continues to remain robust. This is regarded as a positive signal for economic growth. However, Perjessy warned that the political tensions in the country could have a negative effect on macroeconomic stability. He noted that political fluctuations have the potential to undermine investor confidence.

Political Risk and Monetary Policy

Perjessy also expressed concerns that political developments could complicate the execution of monetary policy. He highlighted that the current situation of the Central Bank of the Republic of Turkey allows it to “perform its function,” but it has not yet fully achieved an independent structure. In this context, he assessed the lack of any changes to the Central Bank Law as an important risk factor.

Vulnerability of Turkish Institutions

Perjessy stated that Turkish institutions are weaker compared to their counterparts in similar countries. This vulnerability to political interference emerges as a factor threatening Turkey’s economic situation. Future potential political developments could seriously impact the decision-making processes of investors.