Twin deficits hypothesis

Türkiye's current account balance posts a surplus for the second month in a row in July, data from the Central Bank have shown.

The current account surplus increased from $330 million in June to $566 million in July.

Türkiye's current account deficit came in at $1.24 billion in May, down from $5.4 billion in the previous month, marking the lowest since last October, according to data from the Central Bank on July 12.

In May last year, the current account gap was $7.8 billion.

Türkiye's current account balance produced a deficit of $2.56 billion in January with the annualized gap continuing to shrink, data from the Central Bank has shown.

This was smaller than the $2.8 billion deficit most economists had predicted.

Standard & Poor's (S&P) has confirmed Türkiye's credit rating as "B" and changed its credit rating outlook from "stable" to "positive."

"Confidence in our medium-term program is increasing," Treasury and Finance Minister Mehmet Şimşek wrote on social media platform X on Dec.1, commenting on S&P's move.

In the first major financial crisis of the 21st century which erupted in 2007-2008, and whose tsunami reached Europe's shores in 2010, five European countries failed to avoid bailouts: Greece, Ireland, Portugal, Cyprus and, in part, Spain. Of these, only one, Greece, had twin deficits - in its current account and its budget.

Greece posted a 5.2-billion-euro decrease in the current and capital account deficit in the first quarter of 2023 compared to the first quarter of 2022, a development related to the significant growth in the balance of secondary incomes, i.e.

Turkey's current account balance posted a surplus of $1.65 billion in September, bringing the 12-month rolling deficit to $18.4 billion, the Turkish Central Bank revealed on Nov. 11.

In September 2020, the current account balance posted a $2.3 billion deficit.

Turkey's current account balance posted a deficit of $683 million, down $1.3 billion from the same month last year, the Turkish Central Bank announced on Sept. 13.

With July figures, the current account deficit saw its eleven-month low.

According to the balance of payments figures released by the bank, the country's 12-month rolling deficit totaled almost $27.8 billion.

Foreign trade figures for January released at the beginning of this week have revealed that the deficit has decreased 13.4 percent from $4.343 billion to $3.762 billion. In parallel with the declining foreign trade this year, the current account deficit is expected to continue shrinking.

There has been a dramatic rise in the amount of unregistered money inflow to Turkey, creating some question marks about the origins of this moneyIn the first nine months of the year 2015, Turkey's chronic illness or current account deficit was $25 billion. This deficit was $46 billion the entire year of 2014. For the whole year 2015, it looks as if it will be $42 billion.