Turkey’s Central Bank Survey: One dollar will be 40 liras at the end of the year

According to the Central Bank Market Participants Survey, the end-of-year dollar/TL expectation was 40.0212 liras. The Central Bank announced the February market participants survey conducted with 68 participants consisting of representatives from the real and financial sectors.

Inflation expectation

Accordingly, the February CPI increase expectation, which was 3.51 percent last month, rose to 3.80 percent during this survey period. The current year-end CPI increase expectation also increased from 42.04 percent to 42.96 percent.

Expectations for CPI increase declined from 39.09 percent to 37.78 percent for 12 months ahead and from 23.69 percent to 23.05 percent for 24 months ahead.

Dollar/TL expectation is above 40

While the year-end dollar/TL expectation of the participants was 40.0212, the expectation for 12 months ahead increased from 40.6370 to 41.1543. The year-end current account deficit expectation, which was 34.4 billion dollars in the previous survey period, increased to 34.6 billion dollars in this period.

The current account deficit expectation for the next year, on the other hand, decreased to 32.9 billion dollars.

No change expected in policy interest rate

The Gross Domestic Product (GDP) growth expectation for the current year decreased from 3.4 percent to 3.3 percent, while the growth expectation for the next year decreased from 3.9 percent to 3.8 percent.

Expectations regarding the Central Bank’s policy interest rate for the current month-end and 3 months ahead were determined as 45 percent. The policy interest rate expectation for 12 months ahead stood at 36.62 percent.