Macro and Politics
Tacirler Investment
* The Treasury and Finance Ministry will release September central government budget figures @ 11:00 local time. The central government budget posted a surplus of TL96.7bn in August, while the primary balance recorded a surplus of TL276.4bn. In the same period last year, the budget recorded a deficit of TL129.6bn and a primary deficit of TL32.5bn in the same month of last year. On a 12-month rolling basis, the budget deficit narrowed from TL2.3tn to TL2tn, while the primary deficit contracted from TL417bn to TL108bn. In the Jan – Aug period, the budget deficit reached TL907.6bn, corresponding to 47% of our 2025 full-year deficit forecast, whereas the primary balance registered a surplus of TL518.1bn. The September cash balance data serve as a leading indicator for today’s central government budget figures. Taking into account the usual divergence between the cash-based and accrual-based accounting methods, we estimate that the budget likely recorded a deficit of around TL275bn in September. Please note that we have recently revised our year-end 2025 budget deficit forecast upward from TL1.9tn (3.1% of GDP) to TL2.3tn (3.7% of GDP).
* The Treasury tapped the domestic markets at an amount of TL61.1bn (including non-competitive sales) via yesterday’s 2y and 10y fixed coupon bond auctions, finalizing its domestic borrowing program for October. The bid-to-cover ratios stood at 1.89x and 1.55x for 2y and 10y auctions, respectively, indicating a weak investor demand. The average cost of borrowings were 40.46% for the 2y and 31.87% for the 10y auctions. With yesterday’s double auctions, the Treasury has completed its domestic borrowing program for October, raising TL199.5bn in total - below the initial projection of TL290.1bn. The Treasury’s next 3-month domestic borrowing strategy (November–January 2025) will be announced on Friday, October 31st, at 17:30 local time. In the previous borrowing strategy, the Treasury had projected total domestic issuance of TL117.6bn against its redemption amounting to TL95bn for November.