Turkey's Political Risk Ranked High as BBVA Cuts Growth Forecast

BBVA Research placed Turkey ninth out of 174 countries in its 2021‑2025 Internal Political Risk Index, noting the nation’s low rule‑of‑law score, high polarization and deep income inequality. The report warned that heightened political risk could accelerate capital outflows, raise borrowing costs and dampen economic growth.

In its economic outlook, BBVA said Turkey’s Q1 2024 growth of 2.5% is showing signs of slowing. The firm revised its 2026 growth projection down to 3% from 4% and lifted its year‑end inflation forecast to 30%. It expects the Central Bank’s policy rate to reach about 37% by year‑end and holds the dollar/TRY exchange rate at 52. BBVA also highlighted that tighter macro‑prudential measures and high real rates may continue to support the strong exchange‑rate policy.