World Bank lowers growth forecast for Turkey

The World Bank has lowered its growth forecast for Turkey for 2024, while raising its global growth forecast due to the stronger-than-expected performance of the US economy.

In a report published today, the World Bank raised its 2024 global growth forecast from the 2.4 percent it announced in January to 2.6 percent, while lowering its 2024 forecast for Turkey from 3.1 percent to 3 percent.

The World Bank kept its 2025 growth forecast for the global economy steady at 2.7 percent, while lowering its 2025 growth forecast for Turkey from 3.9 percent to 3.6 percent.

The global growth forecast for 2026 is 2.7 percent, and the growth forecast for Turkey for 2026 is 4.3 percent.

The Bank projected that the tightening of monetary policy in Turkey would reflect on the economy as a whole and contribute to reducing macroeconomic vulnerabilities, and therefore, economic growth would decline to 3 percent this year.

However, it expects economic growth to increase by 3.6 percent in 2025 and 4.3 percent in 2026, driven by strong domestic demand and net exports.

The World Bank projected that inflation in Turkey would remain above the Central Bank's target and fall to an average of 29 percent in 2025. The budget deficit in Turkey is expected to remain high due to rehabilitation and reconstruction costs following the earthquakes that occurred in February 2023.

The World Bank also raised its 2024 US economic growth forecast from the 1.6 percent it announced in January to 2.5 percent.

News Source: 12punto