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This article was originally written for Türkiye Today’s weekly economy newsletter, Turkish Economy in Brief, in its Jan. 19 issue. Please make sure you are subscribed to the newsletter by clicking here.
While Türkiye’s financial markets continue to enjoy a summer-like atmosphere in the middle of winter, the Borsa Istanbul (BIST) 100 index posted a strong rally in the first half of January, gaining an impressive 12.49% and reaching historic highs. On Friday, the index closed at 12,668.52, setting new records on both a daily and weekly basis. Considering that the index ended 2025 with a 14.56% gain, it’s remarkable that nearly all of last year’s gains have been matched in just the first two weeks of 2026.
On Thursday, Jan.22, the Central Bank of the Republic of Türkiye (CBRT) will hold its first Monetary Policy Committee (MPC) meeting of the year. Markets are predominantly expecting a 150-basis point rate cut, which would bring the policy rate down to 36.50%.
Meanwhile, CBRT Governor Fatih Karahan held meetings with international investment banks and financial institutions in London and New York, where he presented Türkiye’s economic outlook. Karahan noted that several core inflation indicators have fallen to their lowest levels since September 2021. He also highlighted that inflation expectations have improved, particularly among households and businesses, and that exchange rate developments in the second half of 2025 supported the disinflation process.
Karahan emphasized that inflation may show some volatility in January and February but affirmed that the CBRT's tight monetary policy stance will be maintained until price stability is achieved, strengthening the disinflation path.
After markets close this Friday, international credit rating agencies Fitch and Moody’s are expected to release their latest assessments of Türkiye.
Market expectations—driven by falling CDS risk premiums, declining inflation and interest rates, returning foreign investors, and corporate balance sheet improvements—suggest that a positive outlook revision could be in the cards.
A Matriks News survey of 18 analysts showed that most expect Fitch to revise Türkiye’s outlook from “stable” to “positive.”
A note from Tacirler Investment echoed this, stating: “We think both agencies may revise their outlooks from stable to positive. However, we don’t expect either Moody’s or Fitch to change the actual rating level at this stage.”
The earnings calendar for 2025 financial results is also approaching for listed companies. These expectations have already begun to be priced into the market. The BIST 100 index closed at $292.72 in dollar terms, just shy of the 2025 peak of $297.72. Analysts highlight this level as a critical technical resistance to watch in the coming period.
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