S&P affirms Turkey's credit rating

By Gokhan Ergocun

ISTANBUL (AA) - The Standard & Poor's (S&P) rating agency kept Turkey's credit rating unchanged late on Friday.

Turkey's long-term foreign currency credit rating remained at B+, while its long-term local currency credit rating was also preserved at BB-.

S&P also affirmed the country's short-term foreign and local currency sovereign credit ratings, which were both B.

In a written statement, the U.S.-based credit rating agency said: "Despite the absence of a coordinated and proactive policy response, the Turkish economy and banking system will navigate existing challenges over the next year, helped by the U.S. Federal Reserve's looser monetary policy."

It noted that the agency could raise the rating if the Turkish government increased the economy's credibility and transparency.

S&P forecasted that Turkey's GDP would shrink by 0.5% in 2019 before expanding by 3.2% during the following three years -- 2020, 2021, 2022.

Turkey's New Economic Program, revealed in the last September, set a growth target of 2.3% for 2019, 3.5% for 2020 and 5% for 2021.

The country's unemployment rate is expected to drop to 12.9% in 2019, 11.8% in 2020, and 10.8% in 2021, according to S&P.

Turkey's economic program also forecasted that the unemployment rate would decrease to 10.8% in 2021.