Macro and Politics

* The Treasury will complete its August domestic borrowing program with today’s direct sales of a 1y USD-denominated bond and a 1y USD-denominated lease certificate. The Treasury tapped the domestic markets to the tune of TL79.1bn, including TL42.5bn through non-competitive sales, in yesterday’s auctions of a 4y CPI-linked bond and a 9y fixed-coupon bond. This brought the Treasury’s total domestic borrowing so far this month to TL450bn. Under its August–October 2026 domestic borrowing strategy, the Treasury plans to raise a total of TL536.7bn from the domestic market against TL596.3bn of redemptions in August, implying a rollover ratio of 90%. Having already raised TL450bn so far this month, the Treasury could borrow around TL87bn through tomorrow’s direct sales.

* The Residential Property Price Index (RPPI) increased by 1.5% m/m and 25.0% y/y to 234.8 in July, while declining by 5.1% y/y in real terms. Besides, the New Tenant Rent Index (NTRI) rose by 1.9% m/m and 28.4% y/y to 328.5, while recording a 2.6% annual decline in real terms. The July data indicate that nominal residential property price growth continues to lag inflation, pointing to an ongoing real adjustment in the housing market.