Macro and Politics

* The Treasury borrowed TL48.3bn in total (including non-competitive sales) via yesterday’s 7y FRN and 9y fixed coupon bond auctions. For the 7-year FRN, the term rate stood at 22%, while the bid-to-cover ratio was notably high at 4.52x, indicating robust demand. For the 9-year fixed-coupon bond, the average cost of borrowing came in at 31.55%, with a bid-to-cover ratio of 2.66x, also reflecting solid investor appetite. As a result, the total domestic borrowing so far this month has reached TL145.5bn. Next week, on July 14, new benchmark bonds with 2-year and 5-year maturities will be issued, alongside a 4-year CPI-linked bond auction. On July 21, the Treasury will hold the direct sales of a 2-year lease certificate, as well as 1-year USD-denominated bond and 1-year USD-denominated lease certificates. 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%.