Friday , June 2 2023

Tired of Turkey's forecasts – Moody's warns of a significant economic downturn


Moody's Investors Service said in a report published on Thursday that Agerpres agency Bloomberg said that Turkey and Argentina would fall significantly in the coming quarters, as growth rates are slowing down in emerging and emerging economies.

As the monetary constraints in major economies and global trade disputes continue to diminish global investment, Moody's adopted a pessimistic view of the growth prospects of emerging market economies like Turkey and Argentina, which are "relatively high in eternal funding and thus are most vulnerable."

According to Moody's, Turkey's economy is expected to enter into an agreement by mid-year, as the pound collapses and the rise in borrowing costs will have an impact on the economy. Moody's also said that the Argentine economy will not recover until 2020, with significant monetary and fiscal consolidation under the program agreed with the International Monetary Fund.

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At present, inflation has been the highest in Turkey over the last 15 years, and high borrowing costs are affecting investment prospects.

"Two-digit inflation, a significant increase in borrowing costs and a decrease in bank lending could affect household purchasing power, private consumption and investment," Moody's said.

The rating agency expects inflation in Turkey to remain double-digit by 2020, as inflation pressure will be exacerbated by exchange rate and oil price pressures. In October, annual inflation in Turkey rose to 25.2%, as the pound dropped fuel prices.

Moody's analysts say Turkey's economy will reach 1.5% in 2018, after falling by 2% in 2019. In the case of Argentina, Moody's predicts that this year's reduction is 2.5% and one of 1.5% in 2019.

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