Barclays raises policy rate forecast, warns about TL weakness

British bank Barclays issued a new report where its analysts expect the CBRT policy rate to reach 35 percent at the end of the year and 40 percent in 2024. The bank also emphasized that the risks to dollar/TL are upward if dollarization pressures develop again.

Barclays announced its dollar/TL, Euro/TL and policy rate forecasts. Stating that Turkish authorities are focusing on closing the current account deficit, Barclays FX team stated that they expect the Turkish lira to be allowed to depreciate.

Predicting that the CBRT policy rate will limit the pressure on the Turkish lira to some extent, Barclays predicted that the policy rate will be 35 percent at the end of the year and 40 percent in 2024.


Risks in Dollar/TL are on the upside

Barclays also emphasized that the risks for dollar/TL forecasts are considerable, if dollarization pressures develop again.


The bank expects dollar/TL to rise to 29 by the end of 2023, 32 in March 2024, 35 in June 2024, and 39 in September 2024.


Barclay, which put forward its end-2023 forecast for Euro/TL as 31.32, predicted that Euro would be 34.56, 38.15 and 42.90 in March, June and September 2024.

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Published By: Atilla Yeşilada

GlobalSource Partners’ Turkey Country Analyst Atilla Yesilada is the country’s leading political analyst and commentator. He is known throughout the finance and political science world for his thorough and outspoken coverage of Turkey’s political and financial developments. In addition to his extensive writing schedule, he is often called upon to provide his political expertise on major radio and television channels. Based in Istanbul, Atilla is co-founder of the information platform Istanbul Analytics and is one of GlobalSource’s local partners in Turkey. In addition to his consulting work and speaking engagements throughout the US, Europe and the Middle East, he writes regular columns for Turkey’s leading financial websites VATAN and and has contributed to the financial daily Referans and the liberal daily Radikal.