Macro and Politics

* The short-term external debt stock in July materialized at USD170.9bn, up by 1.1% m/m.  In terms of short-term debt statistics, we believe that “debt stock on a remaining maturity basis,” calculated based on the external debt maturing within 1 year or less regarding the original maturity, is rather critical, which is at USD223.3bn as of July 2025. Of this total, USD24.6bn is attributed to loans taken by resident banks and private sector affiliates from their branches and affiliates abroad. Stripping this amount from the total results in USD198.7bn. We also add 12-month forward-looking CAD expectations on this amount so as to reach Turkey’s annual external financing need (EFN).  Accordingly, we calculate EFN as of July 2025 around USD220bn.

* In the week of September 5 – 12, foreign investors registered net sales of USD165mn in the equity market, while posting net purchases of USD588mn in the bond market, excluding repo transactions. Consequently, the foreign share in the total government bond stock edged up from 6.4% to 6.6%. Moreover, during the same period, the residents’ FX deposits climbed by USD714mn (excluding gold accounts and adjusted for the EUR/USD parity effect), while their total FX deposits (including gold, price adjusted) soared by USD1.4bn during the week of September 5 – 12. In terms of official reserves, the CBT’s gross FX reserves dropped USD2.2bn to USD178bn and net international reserves slid by USD1.6bn to USD69.5bn. Lastly, net reserves excluding swaps decreased by USD2.5bn to USD51.8bn.