Macro and Politics
Tacirler Investment
*The Treasury will hold 8m zero coupon and 4y TLREF-indexed bond auctions today. According to three-month (July – September 2025) domestic borrowing program, the Treasury has a domestic redemption of TL316.6bn in July, while in return it plans to borrow TL376.4bn in total throughout the month, indicating a roll-over ratio of 119%. After today’s double auctions, the Treasury will hold 7y FRN and 9y fixed coupon bond auctions.
* The Treasury and Finance Ministry will release June cash budget figures @ 17:30 local time. Following a cash surplus recorded in May, we anticipate the Treasury cash balance to revert to a deficit position in June. To recall, the Treasury recorded a cash surplus of TL247.1 in May, while the central government budget posted a surplus of TL235.2bn. It is worth noting that the sizeable surplus recorded in May was largely driven by a surge in corporate tax revenues, stemming from the structural impact of the removal of the fourth corporate provisional tax payment, which was abolished starting in May 2023. The removal of this instalment has led to a concentration of corporate tax declarations in May, reflecting both the first-quarter provisional taxes for the current year and final corporate tax filings for the previous year’s last quarter. This front-loading effect has significantly inflated revenue figures in May. However, we anticipate this temporary revenue boost to fade starting in June, with today’s cash budget figures as well as the upcoming central government budget release returning to deficit territory. We forecast the 2025 budget deficit at TL1.9tn, corresponding to 3% of GDP.