10/24/2008

IMF predicts gradual fall in inflation in Turkey

Dunya - Inflation in Turkey will gradually fall, according to a new International Monetary Fund report. In its latest Regional Economic Outlook Report for Europe, the Fund said inflation would drop in Turkey parallel with falling commodity prices, adding that the country's policy of maintaining fiscal discipline would help this trend. In related news, addressing a conference in London on the Turkish banking system, State Minister for the Economy Mehmet Simsek noted, "Turkey is not immune to the global economic crisis but it is much more resistant to global shocks and fluctuations than it used to be." He indicated that the Turkish banking system is well-equipped to weather the crisis, adding that the government will supply liquidity to the markets if the need arises. Also speaking at the conference, World Bank Director for Turkey Ulrich Zachau echoed Simsek's remarks about Turkey's resilience. "Turkey is now a very different country than when the 2001 economic crisis hit. The country's economy has stronger foundations than seven years ago." But Zachau also warned that the global financial crisis could hurt Turkey, as it needs foreign investments at a time of deteriorating capital movements. He said that the Istanbul Stock Exchange had faced fallout from the crisis but that the impact had remained limited.