High inflation and volatile exchange rate warning from S&P to Turkey

Credit rating agency Standard & Poor’s (S&P) has published an assessment that policy makers in the Turkish economy may have to struggle with high inflation and currency volatility for a long time.

Credit rating agency Standard & Poor’s (S&P) made assessments on emerging economies.

The assessment, which stated that there was a change in monetary policy settings after the elections in Nigeria and Turkey, said, “This is a change that, in our view, could help them rebuild their foreign exchange (FX) reserves and limit retail foreign exchange demand.”

“At the same time, policy makers in both economies may have to contend with high inflation and currency volatility for a long time,” the statement said.

EXPLANATION ON RESERVES

In the evaluation, it was stated that the change in monetary policy in Turkey may contribute to the increase of foreign exchange reserves again.

“Credit conditions stabilize, albeit with higher interest rates in middle-income commodity-importing economies, including Hungary, Poland and Romania,” the statement said, adding that despite high global inflation rates, credit conditions in emerging markets USAIt was pointed out that ‘s monetary tightening cycle process has improved thanks to greater clarity.

middle-income economies ChineseEmphasizing that despite the softening data from Turkey, the macroeconomic resilience showed, “Financial area remains insufficient (in these economies). The cost of new borrowing is higher than it was two years ago, especially for countries with low credit ratings. (AA)

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