Overview of the Downgrade#
JPMorgan has revised its economic growth forecast for Turkey in 2026, lowering it from 4.0% to 3.4%. This change is attributed to the ongoing conflict in the Middle East, which has begun to affect economic activity in Turkey.
Impact on Economic Indicators#
Analysts at JPMorgan have observed a significant decline in key economic indicators since the conflict escalated in late February. Notably, the real sector confidence index, which measures the outlook of businesses, has dropped sharply. Additionally, consumer confidence, which reflects how optimistic consumers feel about the economy, has also weakened.
Alignment with IMF Forecast#
JPMorgan's updated growth projection is consistent with the latest forecast from the International Monetary Fund (IMF), which was published last month. This alignment suggests that broader economic trends are influencing growth expectations in Turkey as geopolitical tensions continue to unfold.