S&P Global revised Turkey’s rating outlook

International credit rating agency S&P Global affirmed Turkey’s credit rating as ‘B’, drawing attention to risks such as post-earthquake recovery costs and uncontrollable inflation, while lowering its outlook from ‘stable’ to ‘negative’.

It was stated that the negative outlook ‘reflects the risks that they see as untenable in monetary, fiscal and economic policies’ and that “Uncontrollable inflation complicates financial, economic and political analysis”.

In the report, it was stated that after the earthquakes in February, Turkey needed internal and external financing up to 12 percent of its GDP.

It was stated that the rating could be lowered if the pressure on financial stability and public finances increased, while it was emphasized that in the positive scenario, the predictability in the money and finance sector would increase and the balance of payments position, especially the net foreign exchange reserves of the CBRT, could increase.

In the statement, which also includes growth forecasts, it was noted that the Turkish economy is expected to grow by 2.1 percent this year and 2.8 percent next year.

S&P downgraded Turkey’s credit rating last September due to its ultra-loose monetary policies.