This paper analyzes the effects of intervention on the level and volatility of the exchange rate in Mexico and Turkey, two emerging countries that have floating exchange rate regimes. The paper finds mixed evidence on the effectiveness of intervention. In Mexico, foreign exchange sales have a...

The momentum in economic reform and disinflation has been maintained by Turkey under the Stand-By Arrangement (SBA). Executive Directors commended the financial sector reform, the achievements in restructuring the economy and improving its economic fundamentals, and emphasized the need to...

Turkey’s Fifth Review and Inflation Consultation under the Stand-By Arrangement and a Request for Waiver of Nonobservance and Applicability of Performance Criteria are discussed. Despite sharply higher interest rates, a weaker lira, and lower asset prices, economic activity has remained robust...

This paper discusses Turkey’s Request for Stand-By Arrangement (SBA) and Extension of Repurchase Expectations. Turkey’s economic program has delivered impressive results. Output has grown rapidly, inflation has fallen to its lowest level in a generation, and government debt has declined...

KEY ISSUES Context: Turkey’s economy has grown on average by 6 percent annually since 2010, but this has come at the expense of a persistently large external deficit making the economy sensitive to changes in external financing conditions. Inflation is high and above the authorities’ target,...

This Selected Issues paper examines the external imbalance situation in Turkey. Turkey’s current account deficit is expected to remain elevated at about 5.5 to 6 percent of GDP through 2019. Reducing the deficit to a more sustainable level about 2.5 to 3 percent of GDP should be a key policy...