Türkiye’s Economic Outlook Stabilizes as Credit Ratings Hold Firm
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International credit rating agency Standard & Poor’s (S&P) has affirmed Türkiye’s long-term credit rating at “BB-”, maintaining a stable outlook amid ongoing efforts by Ankara’s economic team to tighten monetary policy and navigate domestic and global pressures.
In its statement released Friday, S&P also confirmed Türkiye’s short-term rating at “B,” highlighting persistent economic challenges and uncertainties, yet expressing confidence in the country’s medium-term policy framework.
“The stable outlook reflects expectations that Türkiye will sustain tight monetary policies to mitigate economic risks,” S&P noted.
Growth Projections: Steady Improvement Ahead
S&P forecasted Türkiye’s GDP growth at 2.7% for 2025, with an expected uptick to 2.9% in 2026, suggesting cautious optimism despite external volatility and internal adjustments.
The agency’s latest affirmation follows two previous rating upgrades in 2024, during the May and November review cycles, when S&P acknowledged the Central Bank of Türkiye’s (CBRT) tight monetary stance, which contributed to stabilizing the lira, curbing inflation, rebuilding foreign reserves, and reducing dollarization within the financial system.
Broader Credit Rating Landscape: Positive Signals from Moody’s and Fitch
While Moody’s skipped its scheduled January 2025 review, it had previously upgraded Türkiye’s credit rating in July 2024, lifting it two notches from “B3” to “B1” and assigning a positive outlook.
Similarly, Fitch Ratings reaffirmed Türkiye’s BB- rating with a stable outlook in its February 2025 evaluation, signaling broad recognition of Türkiye’s improved fiscal discipline and monetary tightening.
World Bank Upgrades Türkiye’s Growth Forecast
Complementing the credit agencies’ assessments, the World Bank recently revised Türkiye’s 2025 GDP growth projection upward to 3.1% from an earlier forecast of 2.6%. The Bank also anticipates 3.6% growth in 2026, citing resilient economic reforms and stabilization efforts amid a challenging global environment.
Outlook: Türkiye Gains Ground but Challenges Remain
Although Türkiye’s credit ratings and economic forecasts are trending positively, risks remain. Tight monetary policy must be sustained, structural reforms accelerated, and external vulnerabilities carefully managed to maintain momentum.
As global financial conditions evolve, Türkiye’s focus on resilient economic management will be crucial for sustaining ratings improvements and boosting investor confidence.
