Fitch Affirms Turkey's Credit Rating: What to Expect?

International credit rating agency Fitch Ratings has affirmed Turkey's long-term credit rating at 'BB-' and maintained a 'stable' outlook. According to Fitch's assessment, Turkey's low public debt, large and diversified economy, higher per capita income compared to 'BB' rated countries, sustained access to external finance during difficult times, and the resilience of the banking sector are the main factors supporting its credit rating.Fitch forecasts Turkey's potential growth rate to be around 4%, with a growth prediction of 2.8% for 2026 and 4.4% for 2027. The inflation rate, which was at 32% in June, is expected to decrease to 29.5% by the end of 2026.The report states that the Turkish Central Bank's (TCMB) decision to increase funding costs by 300 basis points and tighten credit conditions has contributed to the recovery of international reserves. The gross foreign exchange reserves are expected to reach $167 billion by the end of 2026.Fitch's assessment suggests that a permanent reduction in external financing needs, an increase in the country's external financial buffers, and growing confidence in tight monetary policy to support the decline in inflation could pave the way for an upgrade in Turkey's credit rating in the future.