IMF Raises Turkey Growth Forecast But Warns of Fragilities

The IMF sharply increased its forecast for Turkey’s economic growth this year but warned the prospects of a sustainable recovery from last year’s currency crisis have dimmed, the Financial Times reported. In a concluding statement on Monday published after an annual visit by IMF staff, the fund revised its forecast for full-year GDP growth in 2019 from -2.5 per cent to 0.25 per cent. “Growth has rebounded, aided by policy stimulus and favourable market conditions, following the sharp lira depreciation and associated recession in late-2018,” it said. “The lira has recovered and the current account has seen a remarkable adjustment.” The report warned, though, “the current calm appears fragile,” citing concerns about bad debts in the corporate sector, low foreign currency reserves and the country’s heavy reliance on foreign financing as well as a growing fiscal deficit. Read more