Following the announcement of second quarter growth of 5.1%, a number of the world's leading investment banks immediately revised their forecasts for Turkey's 2017 gross domestic production (GDP) growth.
JP Morgan, Morgan Stanley and Japanese Nomura all upgraded their forecasts for 2017 - the JP Morgan upgrade to 5.3% comes only a month after they predicted a growth rate of 4.6%. Morgan Stanley revised its forecast to 4.3% from 3.3%, whilst Nomura’s forecast was revised to 5.5%.
The major influences on this upward trend were the continuing expansion of the export market, consumer confidence, increasing tourism revenues, investment incentive measures and the Credit Guarantee Fund mechanism (JP Morgan noted that growth may slow once the current guarantee fund is fully utilised).
In addition, Goldman Sachs supported these upgrades, predicting that strong performance is likely to continue to the end of the third quarter. However, whilst noting that 3rd quater growth could be as high as 7%, it said it stood by its previous forecast of 5% for the year.
Goldman Sachs indicated that GDP may expand by around 3.5% in 2018, but only if the Credit Guarantee Fund is extended and additional public expenditures are made.