Local Turkey

Turkey Central Bank announced its year-end exchange rate (USD / TL) forecast

According to the results of the Central Bank’s expectation survey for November, the year-end dollar rate expectation is ₺7.89; this forecast was amounted to ₺7.90 in the previous survey period. The consumer inflation (CPI) expectation rose to 12.47 percent during this survey period.

Central Bank of the Republic of Turkey (CBRT) presented the results of expectation survey for November.

Annual inflation expectation

The current year-end CPI expectation is amounted to 12.47 percent; this percentage was foreseen as 11.76 percent in the previous survey period.

 12-month ahead CPI expectation

12-month ahead CPI expectation is expected as 10.77 percent while it was 10.53 percent in the previous survey period. The 24-month ahead CPI expectation is 9.20 percent while it was 9.05 percent in the previous period.

12-month ahead inflation expectations

Participants evaluated the 12-month ahead inflation rates in the survey period of November 2020.

The average of the CPI is anticipated to be in the range of 9 – 9.99 percent with a chance of 24.72 percent, in the range of 10 – 10.99 percent with a chance of 33.96 percent, and in the range of 11 – 11.99 percent with a chance of 23.18 percent.

According to the evaluation made based on point estimates in the same survey period, It was observed that  26 percent of the participants’ expectations were in the range of 9- 9.99 percent, 28 percent of them expected the range to be 10 – 10.99 percent, and 28 percent expected it 11 – 11.99 percent.

24-month ahead inflation expectations

Participants evaluated the 24-month ahead inflation rates in the survey period of November 2020. The average of the CPI is anticipated to be in the range of 8 – 8.99 percent with a chance of 23.29 percent, in the range of 9 – 9.99 percent with a chance of 36.43 percent, and in the range of 10 to 10.99 percent with a chance of  13.37 percent.

According to the evaluation made on the basis of point estimates in the same survey period, when the 24-month ahead CPI inflation expectations are evaluated, 24.44 percent of the participants’ expectations were in the range of 8 – 8.99 percent, 33.33 percent of them expected the range to be 9 – 9.99 percent, and 22.22 percent expected it 10 – 10.99 percent.

Interest expectations

Current month-end overnight interest rate expectation in BIST Repo and Reverse-Repo Market was 12.83 percent in the previous survey period, it is 14.84 percent in this survey period. The CBRT Weighted Average Funding Cost is expected to be 14.74 percent in this survey period, while it was 12.47 percent in the previous survey period. The CBRT’s one-week repo auction interest rate expectation for the current month was 11.64 percent in the previous survey and is increased to 14.49 percent.

12-month ahead secondary market annual compound interest rate expectation of GDBSs with a maturity of five years or close to five years was 12.74 percent in the previous survey period, it is declined to 12.71 percent in this survey period. On the other hand, 12-months ahead secondary market compound interest rate expectation of GDBS with a maturity of ten years or close to ten years was 13.01 percent in the previous period and declined to 12.65 percent.

Exchange rate expectations

The current year-end exchange rate (USD / TL) expectation was ₺7.90 in the previous survey period, and it is ₺7.89 TL in this survey period.

12-month ahead exchange rate expectation was ₺8.31 in the previous survey period, and is ₺8.41 in this survey period.

Gross domestic product expectations

While the GDP growth expectation for 2020 was -0.8 percent in the previous survey period, it is realized as -0.6 percent in this survey period. GDP growth expectation for 2021 was 4.1 percent in the previous survey period and realized as 4.0 percent in this survey period.

source: finans.mynet.com / translated by Melisa Karayusufoglu

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