Global Markets Mixed as Investors Await Fed Minutes; Istanbul Bourse Rises

Global financial markets experienced a mixed week, with investors closely watching U.S. inflation data and upcoming Federal Reserve minutes. While U.S. Consumer Price Index (CPI) and Producer Price Index (PPI) figures came in largely as expected, showing signs of slowing inflation, geopolitical tensions in the Middle East continue to fuel market uncertainty. The U.S. 10-year Treasury yield rose to 4.70%, and the dollar index climbed to 99.7. Gold prices saw a modest increase, while Brent crude oil surged 6% on supply concerns.

In Europe, most stock markets declined, with Germany being an exception. The Eurozone economy grew by 0.4% in the second quarter, in line with expectations. However, rising inflation in Germany and a decline in industrial production in the UK added to economic concerns. A report highlighted the potential economic damage from extreme heat and drought in the EU, estimated at 180 billion Euros. All eyes are now on upcoming statements from European Central Bank President Christine Lagarde.

Asian markets showed some optimism, particularly in the technology sector, with South Korea's Kospi index ending a seven-week losing streak. Japan's Nikkei 225 also saw gains. However, deflationary concerns resurfaced in China, as July inflation figures came in below expectations. This has reignited worries about the stability of the Chinese economy.

Domestically, the BIST 100 index in Turkey concluded the week with a gain of 2.85%, closing at 14,172.26 points. The Turkish Lira saw a slight increase against the dollar. A significant development was the Central Bank of the Republic of Turkey (TCMB) Governor Fatih Karahan's announcement. During the presentation of the third Inflation Report, Karahan revised the year-end inflation forecast for 2026 upward to 28%, citing energy and commodity price outlooks. He projected inflation to decrease to 15% by the end of 2027 and 9% by the end of 2028.