According to the IMF, Türkiye’s disinflation programme has delivered notable results since the 2024 review. Inflation dropped from 49.4% year on year in September 2024 to 30.9% in December 2025.

The Fund attributed the improvement to strong fiscal consolidation, prudent wage policies and a tight monetary stance. Economic growth, which slowed temporarily in mid‑2024, has regained momentum, with gross domestic product expected to expand by 4.1% in 2025.

Demand for the lira has strengthened, helping to rebuild international reserves, while the current account deficit remains comfortably financed. The IMF stated that Türkiye’s policy mix continues to strike a balance between slower price growth and sustained economic expansion.

Tight monetary policy, moderate wage increases and a broadly neutral fiscal stance are expected to support gradual disinflation in the coming period. Inflation is projected to fall to 23% by the end of 2026, even as domestic demand stays strong.

Growth is forecast at 4.2% next year, supported by rising confidence and further cuts to policy rates. The current account deficit is expected to remain financeable, and reserves are projected to stay near 80% of the IMF’s adequacy metric.

However, the IMF warned that the gradual path toward lower inflation carries costs. Slower disinflation has weighed on the financial sector and contributed to subdued productivity growth. External risks also remain elevated due to global trade uncertainty and ongoing regional conflicts.

Any major negative shock, such as a spike in energy prices or adverse weather affecting agriculture, could prolong a period of still‑elevated inflation. The IMF said Türkiye’s overall economic outlook remains positive, but the country must prepare for vulnerabilities that could intensify in an unpredictable global environment.

–IMF/ChannelAfrica–