Three institutions revise Turkey's year-end inflation forecast

Market volatility continues as a result of the recent arrests. While the Central Bank (TCMB) is implementing new measures one after another against the rise in exchange rates, banking giants are also making striking assessments regarding Turkey's economic outlook.

In the last week, three institutions have revised their year-end inflation forecasts for Turkey upward. 

JPMORGAN EXPECTATION AT 29.5 PERCENT

JPMorgan emphasized that the disinflation process would slow down following the detention and subsequent arrest of Istanbul Metropolitan Municipality Mayor Ekrem İmamoğlu, raising its year-end 2025 inflation expectation from 27.2 percent to 29.5 percent, and its March inflation expectation from 2.3 percent to 3.2 percent.

The bank projects that the TCMB will implement a 150 basis point interest rate cut at every meeting starting from April, while also raising its year-end interest rate forecast from 30 percent to 35 percent.

BOFA FORECAST AT 28.1 PERCENT

Bank of America (BofA) has revised its year-end inflation forecast for Turkey from 25.7 percent to 28.1 percent. The bank's report stated, "We are changing our expectation of a 200 basis point cut in April to a pause and are revising our year-end policy rate from 30.5 percent to 32.5 percent."

BLOOMBERG FORECAST AT 28 PERCENT

According to Bloomberg Economics (BE), the Central Bank's interest rate cut process will slow down. Bloomberg raised its year-end inflation forecast from 25 percent to 28 percent as a result of the turmoil in the Turkish Lira.