The Central Bank of the Republic of Turkey (CBRT) ‘Survey of Expectation’ in April shows that the year-end inflation forecast increased from 15.64 percent to 16.23 percent. The dollar expectation was 6,20 percent instead of 6,06 percent.
The Central Bank announced the April expectation survey, which was answered by 68 participants consisting of the real sector and financial sector representatives and professionals displays that Turkey’s Consumer Price Index (CPI) estimation rose to 1.61 percent from 1.54 percent of the previous survey. CPI expectation for May was 1.11 percent and 1.12 percent, respectively and June expectation recorded 0.88 percent.
CBRT’s latest survey finds out that the current year-end CPI expectation was 15.64 percent in the previous survey period and rose to 16.23 percent during this survey period.
CPI expectation in the previous survey period was 15.24 percent and increased to 15.38 percent in this survey period. The CPI expectation after 24 months was 11,80 percent and 12,06 percent, respectively during the same survey periods.
Growth forecasts reduced 50 percent
CBRT’s USD/Turkish Lira exchange rate predictions jumped from 6.06 percent of the previous survey of expectation to 6.20 percent in the April survey. The account deficit fell to 17.6 billion Dollars in the April chart, from 21.4 Dollar of the previous survey.
Gross Domestic Product (GDP) growth estimation for 2019 was 1.2 percent in the previous survey period and down to 0.6 percent in this survey period. Growth expectation for the year 2020 was 3.2 percent and 2.9 percent in the same survey periods, respectively.
The Turkish economy contracted 3% in the fourth quarter of 2018 after a Turkish currency crisis devalued the lira nearly 30% against the US dollar over the past year. Turkey’s corporate sector has borrowed more than $300 billion or 40 percent of GDP and the unemployment rate surged to 14.7 percent.
Many local and foreign economists comment that Turkey faces deep economic crisis and have to go to the IMF for financial assistance. Ankara’s tension with the USA over the Russian S-400 missile order and ruling Justice and Development Party’s objections to Istanbul election result are important factors that put Lira under pressure.