International credit rating agency Standard & Poor’s (S&P) increased its 2024 total growth forecast for Türkiye to 3%.
Also, the credit rating agency Fitch announced Tuesday it upgraded Türkiye Wealth Fund's (TWF) rating from “B” to “B+.”
In its second quarter economic outlook reports for the US and emerging markets, S&P Global said the growth forecast for Türkiye was increased from 2.4% to 3% for 2024 and from 2.7% to 3% for 2025. On the other hand, the growth expectation for the Turkish economy was reduced from 3% to 2.8% for 2026.
In 2023, Türkiye’s economy grew by a larger-than-expected 4.5%, exceeding the government’s forecast of 4.4%.
The economy expanded by 4.0% in the final quarter of the year, maintaining growth performance uninterruptedly for 14 quarters.
National income per capita increased to $13.110.
Meanwhile, Fitch Ratings has upgraded Turkiye Wealth Fund's (TWF) Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDRs) to 'B+' from 'B' with a positive outlook.
It said the upgrade of the IDRs and the Positive Outlook follow the upgrade of Türkiye's sovereign ratings dated 8 March 2024.
On March 8, Fitch Ratings upgraded the country’s rating to “B+” from “B” and changed its outlook from “stable” to “positive.”
This is because Türkiye has tightened its monetary policy since June 2023.
Senior director in Fitch Ratings’ sovereigns group and primary Türkiye analyst Erich Arispe Morales said Fitch Ratings has “greater confidence” that the country’s current economic policy pivot is “more durable.”
“Regarding the effectiveness of the policy shift, improving reserve levels, reduced contingent liability in terms of effects of protected deposits without increasing dollarization, reduced current account deficit, and easing inflation expectations, these developments warrant the rating that we took,” Morales said.
“Also, with the caveat that we've seen an improvement in the international reserve levels, and we know that if the policy settings are sustained as our base case assumes we will be seeing that reserve coverage will improve to 4.5 months in 2025,” he said. “That would bring Türkiye’s reserve coverage above what is expected for countries with a similar rating which is the B rating category,” the analyst added.
On March 13, Fitch Ratings raised its forecast for the growth of the Turkish economy from 2.5 to 2.8 percent in 2024.
According to the World Economic Outlook report, entitled "Growth expectations improve but inflation continues", the Turkish economy grew in the last quarter of 2023, above expectations, and the increase in private consumption was effective in that.
Fitch expects economic momentum to continue in the first quarter of this year. The Turkish economy is expected to grow by 3.1 percent in 2025.
