Türkiye chartbook: After the shock

Research evidence excerpt

Türkiye chartbook: After the shock

14 July 2026

Türkiye chartbook EconomicsCEEMEA

After the shock

◆ Lower oil prices should offer Türkiye relief in H2 2026, but the Melis Metiner

war has had discernible impact on price and external dynamics Economist, CEEMEA HSBC Bank plc

melismetiner@hsbcib.com

◆ We expect a slower pace of disinflation and more gradual +44 20 3359 2636

monetary policy easing

◆ The combination of a wider current account deficit and weaker

capital inflows remains a source of concern

The decline in oil prices looks set to offer Türkiye relief in the second half of the year,

but the broad outlook has inevitably deteriorated compared to our expectations pre-

Iran war (CEEMEA Economics Quarterly: Storm-tested, 6 July). Q1 GDP data

showed that activity slowed sharply to near-zero in sequential terms, even though the

impact of higher oil prices was not yet visible in March (chart 1). Available Q2 data is

mixed. Industrial output grew by less than 1% in cumulative terms in April-May, while

capacity utilisation remains below its long-term average (charts 5-6). Corporate

sector loan growth has slowed somewhat, from a c35% annualised pace at the end

of Q1 to below 30% at the end of Q2. Consumption-side indicators have fared slightly

better. Retail trade rebounded visibly in May, for instance, while consumer

confidence was above its pre-war level in June, but the real sector confidence index

remained depressed (chart 9). We expect a gradual recovery in Q2-Q4 to take full-

year real GDP growth to 2.2% in 2026.

Following negative surprises in the recent data, we have had to make several upward

revisions to inflation forecasts. We currently see headline CPI at 28% and 15% y-o-y

by end-2026 and end-2027, with risks for next year tilted to the upside, and expect