Standard & Poor's affirms Türkiye's credit rating at 'BB-'

ISTANBUL

Standard & Poor's (S&P) affirmed Türkiye's long-term credit rating at “BB-,” with credit rating outlook stable.

It also affirmed the country's short-term credit rating of “B.”

Pointing to risks to the Turkish economy, it emphasized that the stable outlook reflects the view that the current economic team will maintain tight monetary policy, thus balancing the implementation risks associated with the government's medium-term program in the face of domestic and external tensions.

"The stable outlook on the global scale rating reflects balanced risks to Türkiye's economy, since the twin deficits have narrowed but growth is slowing," it said in a statement.

The statement also included the growth forecast for the country's economy, saying that Türkiye's gross domestic product (GDP) is expected to grow 2.7 percent this year and 2.9 percent in 2026.

“We could raise the rating should there be further progress on bringing the inflation rate closer to single digits and restoring long-term confidence in the Turkish lira and, more broadly, in domestic capital markets,” it said.

Evidence of this would include further de-dollarization of foreign currency deposits in Türkiye's banking system and increased liquidity and depth of domestic capital markets, particularly for foreign currency operations, it added.

S&P said it could lower the rating if pressures on financial stability or wider public finances were to intensify, potentially in connection with unabated currency depreciation, alongside a reversal of anti-inflationary policies and declines in net foreign currency reserves.