US banking giant Wells Fargo reveals Turkiye’s 2025 economic forecast

Brendan McKenna, an economist at Wells Fargo, offered his perspectives on Türkiye’s economy during his appearance on Bloomberg HT. He expects that interest rate cuts will begin in 2025 and shared his inflation forecasts for this year and next.

McKenna stated, “We believe the Central Bank will start cutting rates in early 2025. We have not changed our view here, as we still think inflation remains somewhat sticky. Monetary policy is likely to stay tight.”

Regarding inflation expectations, he commented, “We anticipate inflation to be in the range of 55-60% for this year. Looking at current inflation rates, there is some improvement in price pressures. For next year, we expect inflation to fall between 30% and 35%.”

Highlighting that the inflation outlook is not negative, McKenna acknowledged the Central Bank’s optimism while also pointing out rising geopolitical risks in the Middle East. He noted that increases in oil and commodity prices will affect the Turkish economy.

Minimum wage expectations for Türkiye

“We expect a double-digit increase in the minimum wage,” McKenna said. He also remarked that the Central Bank’s monetary policy appears effective in controlling inflation. “Currently, monetary policy seems adequately tight. We believe the Central Bank will begin cutting rates in 2025, although inflation pressures may persist for some time.”

He concluded by suggesting that a contraction in Türkiye’s economy does not seem very likely.