Future Expectations
Sustainable growth
Net exports are expected to be the main drivers of Turkish
economy’s growth outlook in 2014. The current level of the real
effective exchange rate is expected to be supportive of export
opportunities therefore enabling net exports to make positive
contribution to growth.
Other factors that will be affecting the pace of growth in 2014
can be listed as the course of international capital flows and the
domestic political conjecture.
Developments in key export markets
Developments in Turkey’s main export markets, especially in
the EU, will continue to have a profound effect on economic
activity in the coming period. Accordingly, the recovery in the EU
countries’ economies, which emerged from recession in 2013, is
expected to support the Turkish economy as well.
A flexible monetary policy
The volatility in the exchanges rates that was originated from
the uncertainties about the Fed’s monetary policy during the
second half of 2013 is expected to decrease in the coming
period thanks to the disappearance of such uncertainties. This
will also ease pressure on the inflation front.
The macro-prudential measures, which have been implemented
under the context of the CBRT’s flexible monetary policy are
expected to have a favorable impact on the inflation outlook.
However, the volatility in exchange rates that might stem from
domestic and external factors, will remain as the main risk
factor in terms of price stability.
Banking sector will sustain its growth in 2014, as well.
The CBRT’s current monetary policy raised the sector’s funding
costs.
In the meantime, the banking sector maintains its stable growth
trend thanks to alternative funding sources, such as security
issues.
The upgrade of Turkey’s credit rating to investment grade by
two credit rating agencies indicates that the sector will not
face difficulties in raising funds from abroad. At the same time,
the effects of global liquidity conditions and developments in
the domestic political environment on risk perception towards
Turkey would be influential on the cost of funding and the
amounts obtained.
The sector is expected to improve in parallel with the growth of
Turkish economy in 2014 as it has been in the previous years.
Activities
27
İşbank
Annual Report 2013
