Levent Gürses
There is no promising development for the future. With a 19 per cent increase in electricity prices expected, households rightly do not believe that inflation will fall to even 20 per cent. Households’ annual inflation expectations for the next 12 months have risen to 52 per cent…
One of the significant developments last week was the official end of the Currency-Protected Deposits (CPD) scheme. The cost of this scheme, which both eroded public resources and increased inequality through capital transfers, is estimated to have reached roughly $60 billion. When we factor in the never-ending large-scale projects whose costs have increased dozens of times over, it becomes clear once again how resources are being squandered.
The world is going through a very interesting period. The US, which is threatening Iran and making threats of attack, is amassing its ships in the Mediterranean, while the issue of Greenland remains on the agenda. Everyone is putting a price on Greenland. It is reported that the US is considering offering the 57,000 people living on the island one million dollars each. Interestingly, Russian leader Vladimir Putin has also joined the debate. Putin said that Greenland’s price could be around 200-250 million dollars.
The state of the world has become very strange. Martin Wolf, chief economics correspondent for the Financial Times, emphasised that the US has abandoned the liberal trade policies it has pursued for 80 years and that mercantilism, a concept dating back to the 16th century, now prevails. Imploring that US President Donald Trump has set the global economy back 500 years, Martin Wolf wrote, ‘Economic relations are viewed through the lens of “if you win, I lose”. Where will this policy take us? Some argue that the world will fragment. Such a scenario is plausible.’
Canadian Prime Minister Mark Carney’s still-debated speech at the Davos World Economic Forum also contained observations along these lines. Carney, referring to the fierce competition in the global capitalist system, said that the world was at a ‘turning point,’ that this was not just a transition period, but a ‘break in the world order’ and that ‘a harsh reality had begun in which geopolitical relations between the great powers were subject to no constraints.’ Carney emphasised that the collapse of the post-World War II economic and geopolitical order established under US leadership had ushered in a new era of ‘great power rivalries’ where ‘the strong do what they can and the weak suffer what they must.’
The week’s key developments are as follows:
Actual unemployment stands at 28.6 per cent, with the number of unemployed reaching 11 million 593 thousand
The Turkish Statistical Institute (TurkStat) has released its labour force statistics for December 2025. According to these figures, the underutilisation rate of the labour force, comprising underemployed, potential labour force and unemployed persons, decreased by 0.3 percentage points compared to the previous month, reaching 28.6 per cent in December 2025.
According to the Confederation of Progressive Trade Unions of Türkiye Research Centre’s (DİSK-AR) Unemployment and Employment Outlook Report, broad-based unemployment rose to 28.6%, while the number of unemployed reached 11.6 million; female unemployment rose to 38.3%. The calculated broad-based unemployment figure stood at 11,593,000. It was noted that the gap between broad and narrow definitions of unemployment had widened. The difference between the narrow and broad definitions of unemployment was reported to be 20.9 percentage points. Broadly defined female unemployment was recorded at 38.3 per cent.
According to TÜİK, the unemployment rate among young people aged 15-24 decreased by 1.1 percentage points compared to the previous month, reaching 14.1 per cent. The unemployment rate in this age group was estimated at 12 per cent for men and 18.2 per cent for women. The number of unemployed persons aged 15 and above decreased by 286,000 compared to the previous month, reaching 2,736,000 in December 2025. The unemployment rate decreased by 0.8 percentage points to 7.7%. The unemployment rate was estimated at 6.3% for men and 10.5% for women.
Gold and silver take a breather after relentless rise
Gold, which rose to $5,401 per ounce during the week, took a breather towards the end of the week, putting the brakes on its relentless rise. The strengthening of the US dollar provided the impetus for the decline, and after closing at $5,396 per ounce on Thursday, 29 January, spot gold recorded its sharpest fall since October on Friday, dropping 4 per cent to $5,180. Gold started the week below $5,000, reaching $5,400 on Wednesday.
Gold rose 19.6 per cent in January, while silver rose 54 per cent. Spot silver rose 251 per cent in the last year, while gold rose 83 per cent. Silver also started the week below $100, closing at $116.60 on Wednesday. However, it fell to $11.43 on Friday.
According to experts, investors are realising their profits at high levels, and the rise in the US dollar and declines on Wall Street have led to liquidation in precious metals.
Fed did not cut interest rates, Trump was angry again, will announce new chairman
The US Federal Reserve (Fed) did not make any changes at its meeting last week, leaving interest rates unchanged as expected. US President Donald Trump, who wanted interest rates to be cut, reiterated his reaction to Fed Chairman Jerome Powell. Arguing on social media that Powell had no justification for keeping interest rates high, Trump said, ‘It is hurting our country and our national security.’
In his post, Trump said, “It is costing America hundreds of billions of dollars a year in completely unnecessary and unwarranted interest expenses. With the huge amount of money flowing into our country due to tariffs, we should be paying lower interest rates than any other country in the world. The Fed should significantly lower interest rates now.”
Trump also said at the first cabinet meeting of 2026 held at the White House that they would announce the name of the candidate for Fed chair to the public next week. Trump is expected to nominate Kevin Warsh for Fed chair.
The public’s inflation expectation for one year ahead stands at 52 per cent…
According to the January 2026 Sectoral Inflation Expectations prepared in collaboration between the Central Bank and the Turkish Statistical Institute (TurkStat), while confidence in falling inflation is increasing in financial circles and the real sector, expectations continue to rise among households.
A significant decline was recorded in the 12-month annual inflation expectations of financial and real sector experts: expectations fell by 1.15 points compared to the previous month, dropping to 22.20 per cent.
Contrary to the market and real sector, household inflation expectations continued to rise in January. Households’ 12-month-ahead annual inflation expectations rose by 1.18 points to 52.08 per cent.
In Koç University’s January 2026 inflation survey, households’ inflation expectations for the next 12 months fell from 53 per cent to 52 per cent. During the same period, perceived inflation for the past 12 months also declined from 66 per cent to 62 per cent.
Only half of the Ankara-Izmir high-speed rail project has been completed, with costs increasing 23-fold
The Ankara-Izmir high-speed rail project has been underway for 15 years, yet there is still no light at the end of the tunnel. According to a report by Sözcü newspaper, the cost of the high-speed rail project, which was planned to be completed in 2013 at a cost of 4.3 billion lira, has increased 23-fold to 101.5 billion lira.
Transport and Infrastructure Minister Abdülkadir Uraloğlu stated that the line, which was claimed to be completed in 1,080 days in 20213, is now expected to be completed in 2028. He also announced that the project’s progress rate is 53 per cent. Thus, only half of the project has been completed in 15 years.
The mega line connecting the two airports has been delayed by nine years, and the cost has increased tenfold.
Meanwhile, another report in the Sözcü newspaper stated that the construction of the high-standard 120-kilometre railway line, announced as a ‘mega project’ and intended to connect Sabiha Gökçen and Istanbul Airports, has been delayed by 9 years and its cost has increased 10.5-fold. While the project was estimated to cost 36.2 billion TL in 2021, the 2026 investment programme emphasised that the project would be completed in 2030 and the cost would be 377.4 billion lira.
White goods sector regressed by 8 years
The Turkish White Goods Manufacturers Association announced that the white goods sector experienced a decline in production, domestic sales and exports in 2025. According to a report in Nefes newspaper, the Association President Alper Şengül stated that the sector’s export volume had returned to 2017 levels. The sector’s production volume decreased by 9 per cent compared to the previous year, while domestic sales contracted by 3 per cent. White goods exports in 2025 also declined by 10 per cent compared to the previous year.
Reserves surpassed $205 billion, reaching a new peak
The Central Bank reached its highest-ever level in reserve position, driven by the impact of gold. Gross reserves rose by $9.1 billion from the previous week’s level of $196.1 billion to $205.2 billion as of Thursday, 29 January. This figure marks the first time in the central bank’s history that gross reserves have exceeded the 200 billion dollar threshold. Net reserves, meanwhile, reached 91 billion dollars, an increase of 8.1 billion dollars.
Crisis warning from American economist
American economist Peter Schiff, who predicted the 2008 financial crisis, warned, ‘We are heading towards an economic crisis that will make the 2008 financial crisis look like a school picnic.’ Schiff predicted that a new economic crisis is on the horizon and that this time, the crisis will directly target the US.
Schiff stated that while gold prices continue to rise, investors should not view this rise merely as a hedge, but as a warning that inflation is accelerating, the US dollar is losing global confidence, and a major economic reckoning may be imminent.
Appearing on a Fox Business programme on Tuesday, Schiff stated that gold and silver point to a larger crisis later this year or perhaps next year, commenting, “We are facing a US dollar and public debt crisis. Central banks are buying gold to support their currencies. They are getting rid of dollars and Treasury bonds. We are heading towards an economic crisis that will make the 2008 financial crisis look like a school picnic.”
US non-farm payrolls fell short of expectations in December
US non-farm payrolls data for December came in at 50,000, falling short of economists’ expectations in a Bloomberg survey. Despite the slowdown in employment growth, the unemployment rate falling to 4.4 per cent was interpreted as a mixed signal in the markets.
Meanwhile, there was little change in US jobless claims last week. This reinforced evidence of some stability in the labour market. Jobless claims fell by 1,000 to 209,000 in the week ending 24 January.
Factory orders in the US exceeded expectations
The US Department of Commerce released factory order data for November last year. According to this data, factory orders in the US rose by 2.7 per cent in November compared to the previous month, reaching $621.6 billion. Market forecasts had predicted a 1.6 per cent increase in orders. In October, factory orders had declined by 1.3 per cent on a monthly basis.
Microsoft’s artificial intelligence bill swelled, and shares fell to a record low
Tech giant Microsoft’s shares fell 10 per cent on Thursday, their biggest drop in six years, and its market value plummeted by $360 billion in a single day after it announced a balance sheet that investors did not like. Microsoft exceeded market expectations with revenue of $81.3 billion in the second quarter of its fiscal year. The company’s unexpected increase in artificial intelligence spending during the quarter unsettled investors.
Other important news items are as follows:
- In 2025, for the first time in six years, privatisation exceeded 1 billion dollars. With 1 billion 919 million dollars worth of privatisation, 2025 was the year with the highest privatisation in the last 10 years. Business/facility sales reached 1 billion 52 million dollars, while real estate sales amounted to 856 million dollars.
- At Türk Telekom, which the Wealth Fund reacquired with loans, the outsourcing of field services is now being discussed. According to a report by Birgün, the transfer of 6.3 million subscriptions to two affiliated companies is on the agenda. While technicians are being offered incentives to leave their jobs, it is claimed that Telekom is being gradually privatised.
- TCDD, which has been the subject of controversy over allegations of poor management and privatisation, closed 2025 with a record Treasury debt in the institution’s history. According to a Birgün report, the institution’s total Treasury debt, which stood at 4.733 billion TL at the end of 2024, rose to 5.943 billion TL at the end of 2025.
- The US trade deficit rose from its lowest level since 2009. According to data released in the US, unemployment benefit claims declined, while the trade deficit rose from its lowest level since 2009.