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Contents
1.
OVERVIEW
1.1. Monetary Policy Developments and Monetary Conditions
1
1.2. Macroeconomic Developments and Main Assumptions
4
1.3. Inflation and Monetary Policy Outlook
1.4. Risks and Monetary Policy
2.
3.
4.
5.
6.
INTERNATIONAL ECONOMIC DEVELOPMENTS
8
11
13
2.1. Global Growth
14
2.2. Commodity Prices
16
2.3. Global Inflation
18
2.4. Financial Conditions and Risk Indicators
20
2.5. Global Monetary Policy Developments
23
INFLATION DEVELOPMENTS
37
3.1. Inflation
37
3.2. Expectations
45
SUPPLY AND DEMAND DEVELOPMENTS
57
4.1. Gross Domestic Product Developments and Domestic Demand
57
4.2. External Demand
61
4.3. Labor Market
65
FINANCIAL MARKETS AND FINANCIAL INTERMEDIATION
77
5.1. Financial Markets
77
5.2. Financial Intermediation and Loans
85
PUBLIC FINANCE
6.1. Budget Developments
6.2. Developments in the Debt Stock
7.
1
MEDIUM-TERM PROJECTIONS
95
96
100
103
7.1. Current State of the Economy, Short-Term Outlook and Assumptions
103
7.2. Medium-Term Outlook
107
7.3. Risks and Monetary Policy
110
BOXES
Box 2.1. Balance Sheet Recession: AComparison between Japan and the U.S.
27
Box 2.2. Debt Crisis and Sustainability of Public Debt in the Euro Area
30
Box 2.3. Real Effective Exchange Rate Indicators for Turkey
33
Box 3.1. Taxation of Tobacco Products and Its Effect on Prices
47
Box 3.2. Updated Estimates of Exchange Rate and Import Price Pass-Through
49
Box 3.3. Filtering Short-Term Fluctuations in Price Series
53
Box 4.1. The Relation Between Business Cycles in Turkey and the Global Economy
69
Box 4.2. Recent Developments in Investment
73
Box 5.1. Use of Inflation Compensation in Monetary Policy Analyses
91