Turkish markets set sight on key economic reports in coming week

Turkish market investors are preparing for a series of key economic data releases next week. On Monday, the Housing Price Index and labor force participation statistics will be announced, followed by the Central Bank of the Republic of Türkiye (CBRT) interest rate decision and the Consumer Confidence Index on Thursday.

Last week, markets saw an upward trend. Borsa Istanbul’s BIST 100 index closed 2.23% higher, finishing at 9,389.62 points. The USD/TRY exchange rate increased by 0.2% from the previous week, reaching 34.4330.

The CBRT’s recently published balance of payments data shows a current account surplus of $2.988 billion in September 2024, marking the first time in nearly three years that the current account has posted a surplus for four consecutive months.

Market investors anticipated gradual inflation decline

Finance Minister Mehmet Simsek shared insights from the CBRT’s November Market Participants Survey on his X account.

According to the survey, Türkiye’s annual inflation, which stood at 48.6% in October, is projected to decline to 27.2% over the next 12 months.

Ekim ayında yüzde 48,6 olan yıllık enflasyonun piyasa katılımcıları anketine göre 12 ay sonra yüzde 27,2’ye gerilemesi bekleniyor.

Enflasyon beklentisi 12 ay sonrası için iyileşmeye devam ederken diğer vadelerde sınırlı artış gerçekleşti. Beklentilerdeki artışta son iki aylık… pic.twitter.com/oC6y2lE54H

— Mehmet Simsek (@memetsimsek) November 16, 2024

While inflation expectations for the 12-month horizon continue to improve, shorter-term projections have seen slight increases, influenced by the recent inflation data from the past two months.

Minister Simsek emphasized that, while significant progress has been made, bringing expectations below a certain threshold will take time.

“The path to price stability requires patience and determination. We remain committed to rigorously implementing our disinflation program,” he added.

Interest rates expected to hold steady

Meanwhile, a survey conducted by Anadolu Agency (AA) Finance on the CBRT’s Monetary Policy Committee (MPC) meeting scheduled for Thursday, Nov. 21, revealed unanimous expectations from 10 economists that the policy rate will remain steady at 50%.

The economists’ average year-end policy rate forecast stands at 49.10%. Among the participants, six predicted the policy rate would stay at 50% by year-end, one forecasted 48.5%, and three anticipated 47.5%.

Analysts highlighted key technical levels for the BIST 100 index, identifying 9,500 and 9,550 points as resistance zones, while 9,300 and 9,250 points serve as support levels.