S&P’s Türkiye credit upgrade signals further progress, Finance Minister Simsek says

Finance Minister Mehmet Simsek praises S&P’s credit rating upgrade, highlighting the success of the economic program

Treasury and Finance Minister Mehmet Simsek evaluated Standard & Poor’s (S&P) decision to upgrade Türkiye’s credit rating on his social media account.

Simsek emphasized that the successful outcomes of their ongoing economic program have reverberated in the assessments of credit rating agencies. He noted that the favorable evaluations from S&P, Fitch, and Moody’s suggest an imminent upgrade in the credit rating in the near future.

‘Upgrade signals further evaluations’

Emphasizing the correlation between the positive results of the economic program and the decisions of credit rating agencies, Simsek said: “S&P upgraded Türkiye’s credit rating by one notch after 11 years and maintained its positive outlook. The optimistic outlooks of S&P, Fitch and Moody’s signal further credit upgrades. With unwavering determination, we are determined to maximize confidence in our country by persistently strengthening and implementing our program.”

Positive outlook

Commenting on the credit rating upgrade, Istanbul Chamber of Commerce (ITO) President Sekib Avdagic emphasized that following Fitch, S&P Global also upgraded Türkiye’s credit rating from “B” to “B+” and maintained its credit rating outlook as “positive.”

With the commencement of the disinflation process, particularly in the latter part of the year, we anticipate bolstering confidence in the economy both domestically and internationally, fostering an accelerated influx of foreign capital. As our concerted efforts against inflation persist, marked by coordination and resolve, the Turkish economy stands to emerge victorious. The current and anticipated upticks will significantly bolster market sentiment and Türkiye’s outlook,” Avdagic stated.

Experts on future upgrades

Experts also consider S&P’s upgrade of Türkiye’s credit rating from “B” to “B+” an important development and expect other credit rating agencies to make similar upgrades.

Timothy Ash, senior emerging markets strategist at Bluebay Asset Management, praised the decision, attributing it to the effective policy arrangements implemented by Simsek and his team. “Türkiye’s resilience in overcoming economic risks necessitated this development,” Ash said.

Professor Dr. Erhan Aslanoglu, vice rector of Istanbul Topkapi University, also described S&P’s decision as an expected development. Aslanoglu attributed the positive development to the improvement in Türkiye’s CDS and other risk indicators and a more predictable policy framework, especially monetary policy.

S&P, the international credit rating agency, upgraded Türkiye’s credit rating from “B” to “B+” and maintained its outlook as “positive.”

On the other hand, Moody’s, another credit rating agency, raised Türkiye’s credit rating outlook from stable to positive in January. In March, Fitch Ratings also upgraded Türkiye’s credit rating from “B” to “B+” and changed its rating outlook from stable to positive.

Source: AA