MoM expectations were over the historical averages until October (2003-2019 Median – Aug.: +0.4% Sep.: +1% Oct.: +1.9%).
YoY CPI figures could exceed 19% in August and September.
Year-end CPI expectation reached to 16.3%, up 66bps MoM.
According to the probability distributions of inflation expectaions, YoY CPI is expected to be at double-digit levels with a 93% of probability in the coming 12- months while that probability hit 78.1% for 24-month ahead.
Expectations for 12-month ahead decreased by 14bps to 12.48 whereas expectations for 24-month ahead continued to stay at double- digit levels for the third consecutive month by 10.52%, up 9bps.
Expectations for 5-year ahead continued to deteriorate for the 7th month in a row with 7.64%, up by 13bps BIST o/n repo rate is expected to be at 19% at the end of the month.
Policy rate (19%) would be kept stable at 19% in this month and in next 3 months.
The policy rate could be at 14.8- 15% in 12-month ahead and 12- 12.25% in 24-month ahead.
Economic growth expectation of 2021 increased from 5.8% to 6% while next year’s expected growth remained stable at 4%.
Expectations of 12-month current account deficit of 2021 decreased from USD24.7bn to USD23.5bn and next year’s expectations decreased from USD21.3bn to USD21.2bn.
Upward trend on the expectations of USDTRY level halted in August.
Expectations of USDTRY currency for the year-end decreased by 0.5% to TL8.94 and 12-month ahead increased by 0.3% to TL 9.37.
Source: Y.F. Securities Research