Erdogan's economic failure: the stock market soars, but the lira is worthless

The BIST 100 index has surged 850% in five years, but cumulative inflation has exceeded 600% and the lira has weakened by more than 80% against the dollar. The gap between nominal returns and economic reality reveals the depth of the crisis.

The BIST 100 stock index of the Istanbul Stock Exchange has surged 850% in five years, but almost all of the increase was driven by high inflation and a sharp depreciation of the Turkish lira. Annual inflation stands at about 31.5% as of August 2026, and cumulative inflation has exceeded 600%. The lira has weakened by more than 80%: in 2021, 8.3 lira were needed for one dollar; today, about 48 lira. The article explains that the index's rise does not reflect a real strengthening of companies, but rather the erosion of the currency's purchasing power. Investors are shifting savings from nominal assets to stocks as a hedge against inflation, but real returns are low. The article notes that similar phenomena have occurred in other economies with high inflation.