Fitch upgrades Türkiye’s 2025 growth forecast, sees inflation slowing

LONDON

Fitch Ratings has raised its 2025 growth forecast for Türkiye to 3.5 percent from 2.9 percent, following stronger-than-expected economic performance in the second quarter of the year.

In its latest Global Economic Outlook report, Fitch projected the Turkish economy will also grow by 3.5 percent in 2026 and accelerate to 4.2 percent in 2027.

Türkiye aims to increase its GDP by 3.3 percent in 2025, 3.8 percent in 2026, 4.3 percent in 2027, according to the country's medium-term program (MTP) for 2026-2028, released on Sept. 8.

The report highlighted that annual inflation in Türkiye continues to ease. Based on current monthly trends, year-end inflation is expected to slow to 28 percent in 2025, 21 percent in 2026, and 19 percent in 2027, according to Fitch.

The ratings company also forecast that the Central Bank will cut its policy rate by a total of 800 basis points over three policy meetings this year, ending 2025 at 35 percent.

Globally, Fitch has moderately increased its 2025 world growth forecast to 2.4 percent, up 0.2 percentage points from June, citing better-than-expected second-quarter data.

However, the agency noted signs of an underlying slowdown in the United States and said some of the eurozone’s positive growth surprises were linked to U.S. tariff front-running.

Despite the upward revisions, Fitch still expects global GDP growth to slow sharply from 2.9 percent last year and remain below trend.

China’s 2025 growth forecast has been raised to 4.7 percent from 4.2 percent, the eurozone’s to 1.1 percent from 0.8 percent and the U.S.’ to 1.6 percent from 1.5 percent. For 2026, global growth is now projected at 2.3 percent, 0.1 percentage points higher than previously forecast.