Inflation Expectations Rise as TCMB’s November Market Participants Survey Signals Shifting Outlook

The Central Bank of the Republic of Turkey (TCMB) has released the results of its November 2025 Market Participants Survey, drawing on responses from 68 representatives across the financial and real sectors. The findings provide a detailed snapshot of how markets view inflation, interest rates, exchange rates, growth, and the current account balance as they head into 2026.
This month’s results show notable upward revisions in inflation expectations, while projections for interest rates and the exchange rate indicate more moderate changes.

Inflation Expectations Continue to Climb

The survey revealed a renewed increase in year-end consumer inflation (CPI) forecasts. Market participants now expect inflation to reach 32.20% by the end of 2025, up from 31.77% in the previous survey.
Expectations for the medium term also indicate elevated price pressures, with a 12-month inflation forecast of 23.49% and a 24-month inflation projection of 17.69%.

According to the probability distribution for the next 12 months, 52.71% of respondents anticipate inflation landing in the 22.00%–24.99% range. For point estimates, the share increases to 62.50%, suggesting a strong clustering of expectations around the low to mid-20s.
Looking 24 months ahead, 49.72% of participants foresee inflation in the 16.00%–18.99% band, with point estimates rising to 55.17%, reflecting broad market confidence in a gradual easing of inflation.

Limited Movements in Interest Rate Expectations

Interest rate projections in the survey displayed slightly upward but largely restrained adjustments.
For the Borsa İstanbul Repo–Reverse Repo Market, the expected end-of-month overnight rate stood at 39.35%, only marginally higher than the 39.15% recorded in the previous round.

For TCMB’s upcoming December Monetary Policy Committee (MPC) meeting, participants expect the policy rate to register at 38.28%.
Expectations for the following months suggest a gradual decline, with forecasts of 37.11% and 35.81%.
Long-term expectations indicate a more pronounced easing cycle, with the policy rate projected to fall to 29.32% in 12 months and 20.96% in 24 months.

Exchange Rate Forecast: Dollar/TL Seen Surpassing 50 in 12 Months

Currency expectations suggest relatively stable short-term projections, but more significant medium-term adjustments are anticipated.
The year-end USD/TRY forecast came in at 43.42, slightly below the previous survey’s 43.56 level.
However, the 12-month projection rose to 50.62, marking the latest sign that market participants expect a continued, controlled depreciation of the lira.

Growth and Current Account Projections See Mild Revisions

Expectations for Turkey’s economic growth were also updated.
The GDP growth forecast for 2025 increased modestly from 3.3% to 3.4%, reflecting cautious optimism for domestic economic momentum.
Forecasts for 2026 remained unchanged at 3.8%.

Current account expectations point to ongoing external imbalances.
Participants foresee a $20.9 billion deficit for this year and a wider $24.3 billion deficit for 2026, suggesting persistent structural pressures in trade and external financing.

Survey Composition and Methodology

The TCMB conducted the November survey between November 10 and 12, 2025, gathering responses from 51 financial sector participants and 17 representatives from the real sector.
Together, these insights provide a consolidated view of how key market actors assess Turkey’s near-term macroeconomic trajectory, including inflation dynamics, monetary policy direction, and external balance risks.