Moody’s praises Turkey as “financial anchor”

International credit rating agency Moody’s stated that the fiscal discipline in Turkey will ensure that the public finances maintain their resilience.

In the report titled “Emerging Markets Outlook” of the credit rating agency, it was stated that Turkey is expected to grow by 4.8% next year.

“Turkey’s fiscal anchor and strong credit growth that supports economic activity will ensure the resilience of public finances,” the report said.

In the report, where the possible impact of the demographic outlook on the performance of banks in emerging markets is evaluated, “Aging workforce will reduce the profitability of banks in Eastern Europe and Russia. Banks in Central Asia and Turkey will benefit more from the loan demand from the young and growing population.”

In the report, which stated that inflationary pressures in emerging markets are most evident in Latin American countries and Turkey, it was stated that inflation stabilized in Indonesia and China.

In the report, which noted that while inflation increased in Russia, it began to decline in India, it was reported that economic activity in the vast majority of emerging markets is expected to return to its pre-epidemic level by 2022.

In Moody’s report, it was stated that economic growth in emerging markets is expected to remain lower in 2022 compared to this year.

In the report, which pointed out that tight financial conditions are expected to continue in the upcoming period in emerging markets, it was noted that companies with a weak outlook in these markets may face credit tension.


Moody’s Vice President Ariane Ortiz-Bollin, whose evaluations are included in the report, said, “Credit conditions are expected to stabilize (in emerging markets) next year. But higher leverage and worsening financial conditions will increase credit risks for weaker emerging markets.”

“In most economies, inflation will slow, but the risks from rising food and fuel costs remain high,” Ortiz-Bollin said.

Moody’s raised its growth forecasts for Turkey in its report titled “Global Macro Outlook 2022-23” published last week.

The credit rating agency increased its 2021 growth forecast for the Turkish economy from 6% to 9.2%, and its growth expectation for 2022 from 3.6% to 4.8%.

Source: Sabah / Translated by Irem Yildiz

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