Amid ongoing geopolitical tensions between Turkey and Syria, the US-based Moody’s Investors Service provides some insights into the country’s economic situation.
Key Points:
Turkish economic programme growth targets risk increasing macro imbalances.
Sees 2019 Turkish growth at 0.25%, rebounding to at least 3% in 2020 and 2021.
New Turkey growth targets do not seem compatible with other assumptions in economic plan.
Expects Turkey balance of payment pressures to resume once growth picks up.
Not clear Turkish growth targets possible without significant fiscal stimulus.
Until Turkey implements reforms it will remain vulnerable to balance of payment crises.
Meanwhile, USD/TRY rallies hard to reach the daily tops at 5.8827, +0.86% on the day.
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