More on local elections and reserves
With 5 weeks left to the polling day, the municipal election race is heating up, already witnessing trend reversals. Poll results show CHP incumbents ahead in Istanbul, Ankara and Izmir. President Erdogan has a decisive propaganda advantage on opposition rivals, but he has two significant weaknesses.
Mehmet Simsek heralded that Turkey would graduate from the FATF gray list as early as June. Does it matter?
Each new day reveals more Turkish names and firms being sanctioned by Western powers for violating Russia sanctions. Trade is hurt, trade financing is hitting snags. Is this a systemic problem? What are Turkish commercial banks trying to do?
The politics author is already contemplating the day after elections, losing sleep over a constitutional debate that may lead to another vote in early 2025.
It was not a very busy week on the econ side. Having already reported on the MPC, we quickly look at February confidence indices (a mixed bag, but no decisive weakness), utter a few words on the cancellation of the UAE deal (hmm…) and provide an update on the usual financial data, i.e. reserves (down again) and deposits (F/X stable, TL up thanks to government spending).
There are a number of important releases next week. We already know that the January trade deficit should be around $6.2 billion, based on preliminary data, but Q4 GDP numbers will be interesting to watch. Various estimates we saw place the sequential growth rate, very roughly speaking, in the +/- 0.5% band, while we think a slight contraction is probably somewhat likelier.
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