Barclays Revises Growth Outlook for Russia and Turkey Amid Policy Supports
Barclays’ analysts have adjusted their projections for Russia and Turkey, signaling a more optimistic near-term growth path for both economies in 2022 and 2023. The updated base case lifts Russia’s 2023 GDP growth to about 1.7 percent from 0.7 percent previously, while Turkey’s 2023 growth is nudged up to around 2.9 percent from 1.2 percent. The revision reflects confidence that supportive policy settings and solid domestic demand dynamics can help sustain momentum even as global uncertainty lingers.
The assessment highlights the important role of active fiscal policy in both countries. In Russia, continued budget spending and ongoing lending programs have boosted household purchasing power and domestic demand, contributing to a more resilient year-on-year start. Turkey has also benefited from fiscal measures and credit expansion that helped maintain momentum in the first half of the year. Yet observers will watch how durable this demand support proves as external conditions evolve.
Despite the positive tilt, Barclays’ team cautions that the path forward is not guaranteed. Potential vulnerabilities arise from tighter monetary policy in Russia and the risk of renewed sanctions, which could restrain the recovery if financial conditions tighten more than anticipated. In Turkey, even as the forecast for 2023 sits around 1.6 percent, inflation pressures and policy trade-offs could shape the medium-term trajectory despite early gains.
Earlier in the year, the Russian Ministry of Finance outlined a scenario where GDP could grow near 2 percent in 2023, a path consistent with continued monetary restraint and inflation control. The macro environment for both nations features an ongoing cycle of monetary tightening amid elevated inflation, a dynamic that can test the resilience of domestic demand. Barclays’ team argues that government support packages and strategic financial measures offer a cushion that supports more favorable growth forecasts, while also stressing the need for vigilance against external shocks and policy-induced risks as the year progresses.
As discussions around budget discipline and fiscal responsibility mature, the overall assessment remains that proactive government spending, targeted credit programs, and careful calibration of monetary policy can help sustain stronger growth trajectories in Russia and Turkey. The outlook depends on how policy mix interacts with global price movements and sanctions developments, and on how quickly each economy can translate policy confidence into broad-based activity across sectors.