Macro and Politics

* The Treasury raised TL143.6bn through yesterday’s direct sales of a 1-year gold-denominated bond and a 1-year gold-denominated lease certificate. As a result, it has completed its January domestic borrowing program, raising TL479.6bn in total — slightly below the initial target of TL487.7bn. The Treasury’s next three-month domestic borrowing strategy (Feb – Apr 2026) will be announced on January 30 at 17:30 pm local time. In the previous program, the Treasury projected domestic borrowing of TL519.9bn against redemptions of TL636.6bn in February.

* The CBT published the results of its January Sectoral Inflation Expectations Survey. 12-month-ahead inflation expectations declined m/m by 1.15pp to 22.2% among market participants and by 1.9pp to 32.9% for the real sector, while household expectations rose by 1.18pp to 52.1%. Although expectations across economic agents have followed a broader downward trend since early 2024, the pronounced dispersion across segments remains intact. The latest readings suggest that expectations continue to exhibit an adaptive component, responding closely to recent inflation prints. In this context, and consistent with our inflation outlook, we expect the gradual moderation in sectoral expectations to persist in the period ahead.