The board is in place but markets await a payment timetable

Management has moved from the courts to politics

President Erdoğan convened the Economic Coordination Meeting on 29 September, and 2 concrete decisions came out of it. According to AA's report of 29 September, the first decision set up a Fund Coordination Board for the funds in liquidation. Vice President Cevdet Yılmaz will chair it. Under the second decision the State Supervisory Council, the audit body attached to the Presidency, began examining recent fund transactions. That brought 2 separate public bodies into the file.

According to Bloomberg HT's report timed at 21:15, the Capital Markets Board (SPK) presented a roadmap for paying investors whose ownership has been confirmed. The same meeting was also briefed on the transfer of 3 finance companies to a state-owned participation bank. However, the date and amount of the payment appeared in neither of the 2 sources, and this information could not be verified. The board's remit is broad, but the 1 question the market is asking, namely when the money will come back, went unanswered.

The market is pricing the timetable, not the board

According to AA, the BIST 100 lost 302.18 points on 29 September and closed 2.40% lower at 12,290.58 points. Turnover was 108.8 billion lira, and the index had already fallen 2.38% on 28 September. Bloomberg HT's market page shows the index's monthly loss at 13.62%. The sector breakdown shows where the stress sits: the leasing and factoring index fell 8.20%, while the banking index rose 0.10%.

This divergence shows that, as of 29 September, selling was directed at non-bank finance rather than at bank balance sheets. Bonds and the currency are calm compared with equities, but the 1-week trend does not point to relief. According to Investing.com data, the 10-year yield rose from 32.52% on 22 September to 32.90% on 29 September, a 1-week increase of 38 basis points. The 2-year benchmark yield stayed above the 37% policy rate at 37.03%. The 5-year CDS is the annual cost of insuring Türkiye's dollar debt against default. It stood at 249.98 basis points on 28 September. According to AA, the dollar was at 49.00 lira at 18:20 on 29 September.

The gap between Fitch's calm and market pricing

According to the newspaper Dünya, Fitch Senior Director Douglas Winslow said on 29 September that he did not expect the investigation to create systemic risk or dollarisation. Türkiye is rated BB− with a stable outlook. Fitch projects inflation of 30.5% and a dollar rate of 51 lira for the end of 2026. Winslow also said 150 basis points of rate cuts were possible by year-end.

The market is not pricing that cut, because the 2-year yield is 3 basis points above the policy rate. A rating agency looks at external payment capacity, meaning reserves and debt service. The equity investor is looking at a payment timetable that was still unannounced on 29 September. The 2 readings therefore do not contradict each other; they answer different questions. The rating can stay unchanged while the loss of confidence in the domestic market continues. The 13.62% index loss in September is the measure of that.

The inflation figure narrows the CBRT's room

In AA Finans's survey of 20 economists, the average expectation for September CPI was 2.18%, with forecasts ranging from 1.90% to 2.60%. Monthly inflation was 1.84% in August. If the expectation is met, the annual rate falls from 31.51% to 30.16%. TurkStat will publish the figure on Monday 5 October.

While the annual rate is falling by 1.35 points, expectations are drifting upwards. In the same survey the year-end forecast rose from 29.49% to 29.66%. The TEPAV food index reported by Dünya rose 2.23% in September, its fastest monthly increase since April. In the CBRT's survey of 67 participants, the expected policy rate stands at 37%. The central bank is squeezed from 2 directions. A figure above 2.60% would delay a cut, while the loss of confidence created by the fund crisis raises the cost of a tight stance.

External pressure arrives through two channels

On 29 September the US Treasury added 10 individuals and entities in Iran's military procurement network to its sanctions list. The list includes 1 company established in Türkiye. Its volume of business is not given in the sources and could not be verified. The economic effect of 1 company is limited, but tighter screening by correspondent banks could slow foreign trade payments.

The 2nd channel is trade. According to a DEİK report cited by AA, China increased its exports to Africa by 25.9% and to the Middle East by 9.7%. In 2025 China exported 19.97 billion dollars to Egypt and Türkiye 4.07 billion dollars. If price pressure rises in these foreign-currency-earning markets, the competitive room that a rate of 49.00 lira gives exporters will narrow.

What to watch

Three indicators stand out for the next 1 week. The first is whether the board makes a payment announcement with a date and an amount. If it does not, sell-offs of the kind seen in factoring, at 8.20%, could recur. The second is whether the CPI figure on 5 October exceeds the top forecast of 2.60%. The third is whether the CDS settles above 250 basis points. If the first indicator is positive and the other 2 are calm, the stress stays confined to the equity market.