OECD Lifts Turkey Inflation Forecast, Cuts Growth Outlook for 2026-27
The OECD has raised its inflation forecasts for Turkey and lowered its growth projections for 2026 and 2027, marking its third growth downgrade this year.
The Organisation for Economic Co-operation and Development has sharply raised its inflation forecasts for Turkey while cutting its economic growth projections for 2026 and 2027.
In its latest economic outlook, the OECD put Turkish headline inflation at 31.5% for 2026, up from 28.4% projected in June, and above the latest estimates from Turkish authorities. For 2027, the inflation forecast was raised to 24.7% from 18.3%.
At the same time, the organisation lowered its growth forecast for Turkey to 2.7% in 2026 from 3.1%, and to 3.6% in 2027 from 3.8%. The revision is the third time the OECD has downgraded Turkey's growth outlook this year.
Turkey, a large energy importer, has faced some of the world's highest inflation rates in recent years. Annual inflation peaked at 85.5% in late 2022 and climbed above 70% in May 2024 before beginning a sustained decline after aggressive tightening by the central bank.
The OECD said energy and fertiliser costs remain a headwind, but it expects Turkish inflation to keep moderating, with disinflation continuing into 2027.
In June, the OECD had cut its 2026 growth forecast for Turkey, pointing to weaker domestic demand amid high energy and commodity prices and tighter financial conditions, while leaving its 2027 growth outlook unchanged.
The revised Turkey projections come as the OECD slightly raised its global growth forecasts for this year, saying AI-driven investment is helping the world economy hold up better than expected, even as a more entrenched energy shock weighs on the outlook for 2027.