The timely, targeted and temporary fiscal measures such as funding support and employment incentives have a high multiplier effect and a significant potential for creating tax revenues, which is expected to limit the impact of these measures on the budget deficit to some extent.
The fact that the effectiveness of fiscal policy increases in low-growth periods enables the implementation of countercyclical expansionary fiscal policy without a lasting deterioration in fiscal discipline.
There is a noticeable extension in maturities of TL deposits since September. In the current financial setting, which has seen favorable implications of fading uncertainties and a macroeconomic rebalancing, the tax regulation made vis-à-vis withholding rates has contributed to the extension of deposit maturities as well as to curbing the dollarization.
In this blog post, we aim to examine the domestic debt instrument preferences of investors in Turkey and compare them with some selected countries. Cross-country comparisons reveal that non-resident investors prefer long-term fixed-rate debt instruments. However, instrument preferences of other investors of the domestic debt stock vary across countries.