Following Wednesday’s release of employment data, Turkey’s central bank will reveal its inflation forecast for 2019 today. It is unclear
Following Wednesday’s release of employment data, Turkey’s central bank will reveal its inflation forecast for 2019 today.
It is unclear what the bank’s exact estimate will be, but the number could very well be in double digits after the forecast was raised from 6.5% to 9.3% last month. With Turkey’s central bank struggling to remain independent, it is possible that its forecast will underestimate the country’s inflation crisis.
High inflation is just one of a myriad of problems for Turkey’s economy. Ankara is also facing a huge trade deficit, which is being compounded by both its declining currency and a diplomatic row with the US.
The volatility of Turkey’s economy may not be a problem for only Ankara. Indeed, the rapid depreciation of the lira has sparked a sell off by investors of other emerging economies’ currencies, with Argentinian, Indian, South African and Russian currencies all falling in the past week. As such, watch for global markets to suffer from Turkey’s burgeoning economic crisis.
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