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Fitch Ratings Raises Turkey's Growth Forecast. 🇹🇷
- Fitch Ratings, an international credit rating agency, has increased its medium-term potential growth forecast for Turkey's economy from 3.9% to 4.1%.
- This change is part of Fitch's report titled "Weakening Potential Growth in Emerging Markets as China Slows Down," where the organization lowered the average potential growth forecast for 10 emerging economies to 4% from the previous estimate of 4.3%.
- The main factor behind this decrease in growth forecasts is the expected decline in China's supply-side growth potential.
- In line with this, China's potential growth estimate for 2027 was lowered from 5.3% to 4.6%, while Russia, South Korea, and South Africa also saw reductions in their potential growth estimates.
- However, India and Mexico's economies had their potential growth forecasts raised, from 5.5% to 6.2% and from 1.4% to 2%, respectively.
- Turkey was one of the countries with an increased potential growth forecast, now standing at 4.1%.
- Fitch Ratings also raised potential growth estimates for Poland, Brazil (except for Brazil), and Indonesia.
- The agency noted that, except for Brazil and Poland, recent growth forecasts are lower than pre-COVID-19 estimates for the 10 emerging economies, attributing this to worsening demographic trends and disruptions due to the pandemic.
- It was also mentioned that revisions in forecasts for capital stock and productivity growth played a role in these adjustments.
This update from Fitch Ratings suggests a positive outlook for Turkey's economy in terms of its potential for growth in the medium term.
