Headline: Today's Key Developments at Home and Abroad
Global markets and developments in the Turkish economy continue to draw attention to economic indicators and policies. President Erdoğan's views on international relations and counter-terrorism, the Turkish Central Bank's historic peak in reserves, and the IMF's global economic warnings are among the highlights of the day.
Erdoğan emphasized Turkey's determination and provided updates on international collaborations. He highlighted Turkey's resolve against terrorism, strengthened by an attack on TUSAŞ. Additionally, Erdoğan mentioned initiating an initiative with BRICS member countries at the UN to halt arms sales to Israel and sought their support.
Erdoğan stated that global justice and development are possible with the establishment of peace and security beyond borders. He held a meeting with Russian President Vladimir Putin in Kazan, Tatarstan. The discussions focused on Turkey-Russia bilateral relations, the Ukraine-Russia war, and regional-global issues.
The Turkish Central Bank's reserves reached record levels, with an increase of $1.979 billion in the week of October 18, reaching an all-time high of $159.365 billion. The bank's net international reserves also surpassed $60.66 billion. In the Central Bank's Monetary Policy Committee Meeting Summary, it was noted that food prices would significantly impact October inflation, while core goods inflation would remain low. The pace of improvement in inflation was described as uncertain, with a commitment to maintaining a tight monetary policy stance.
Investment preferences of domestic and foreign residents showed that as of October 18, foreign residents saw an outflow of $73.6 million in equities and a net inflow of $115.7 million in government debt securities. Domestic residents' foreign currency deposits and funds rose to $169.64 billion. The Financial Services Confidence Index increased from 157.8 in the previous month to 167.6 in October. Slight declines were observed in personal credit cards and consumer loans in the banking sector, while a downward trend in exchange rate-protected TL deposits and participation accounts was notable.
IMF assessments, as stated by IMF Director Kristalina Georgieva, indicated that the global economy is at risk of being trapped in low growth and high debt. Georgieva emphasized the need to reduce inflation to its target without harming the labor market, proposing reforms with the World Bank to address liquidity concerns. The IMF also warned that trade tensions between the U.S. and China could have costly impacts on the global economy, cautioning that China's growth could fall below 4% without intervention.
Other key developments in the global economy included the Federal Reserve's Beige Book, which showed little change in the U.S. economy recently, although building permits decreased. New home sales exceeded expectations in September, reaching 738,000, while weekly jobless claims were below expectations. Manufacturing PMI data for the Eurozone and Germany increased, but ECB members agreed on the need for caution in lowering interest rates. While the Bank of Japan continues with rate hikes, further rate cuts are being considered by the ECB. The Bundesbank voiced concerns that Germany's economy is slowing down.