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Japan-based Rating and Investment Information (R&I) upgraded Türkiye’s sovereign credit rating by one notch on Friday, marking its first increase for the country in eight years.
R&I raised Türkiye’s long-term foreign currency rating to "BB" from "BB-" and maintained the outlook at stable, citing improvements in macroeconomic policy credibility and economic fundamentals.
“The government is pursuing policies focused on maintaining discipline, aiming to contain inflation. The fiscal balance has improved and the government debt ratio remains at a low level,” the agency said in a statement.
R&I noted that the central bank’s continued tight monetary stance has slowed economic activity, but said growth is expected to remain at sustainable levels.
“The central bank's continued tight monetary policy led to a slowdown in the economy, but a certain level of growth is likely to be sustained,” it added.
The agency highlighted improvements in Türkiye’s external position, pointing to a narrowing current account deficit, stronger capital inflows and an increase in foreign exchange reserves in both volume and composition.
R&I said these developments have contributed to a reduction in external vulnerabilities.
R&I also pointed to resilience in the financial sector, citing strong capital adequacy, solid profitability and low non-performing loan ratios in the banking system.
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On public finances, the agency said fiscal consolidation has continued despite earthquake-related spending, noting that the budget deficit-to-GDP ratio has declined and the primary balance is expected to return to surplus.
It described Türkiye’s relatively low public debt ratio compared with peer economies as a key anchor for debt sustainability.
The upgrade signals renewed international confidence in Türkiye’s economic policy framework and could provide further support for investor sentiment.
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