Turkey raises minimum wage by a quarter

Turkey has hiked its net monthly minimum wage to 28,075 lira ($655) for next year, Reuters reported, quoting the country’s labour minister Vedat Isikhan. The new pay threshold marks an increase of 27 percent from 2025, the report said.

The move is likely to have a direct impact on 9 million workers. Traditionally, increases in the minimum wage are used as the base for pay rises in other income brackets within the public and private sectors.

The announcement comes as Turkey battles high inflation and a depreciating currency. Inflation in the country remains elevated despite falling every month since peaking at 65 percent in May 2024. In November, annual consumer-price gains eased to 31 percent.

Consequently, the central bank lowered its main lending rate this month to 38 percent. Further cuts are forecast in the new year, in line with a projected fall in inflation towards the government’s 2026 year-end target of 16 percent.

Further reading:

• Turkey’s finances hold firm despite record public debt
• Turkey ends 2025 with stronger economy despite high inflation
• Turkey’s growth numbers are misleading investors

The Turkish lira has witnessed significant depreciation. It hit a record low of 42.6 per US dollar this month, extending its year-to-date decline to 26 percent.

In July, Moody’s upgraded its rating for Turkey from B1 to Ba3, three levels below investment grade, bringing its assessment into line with the two other major rating agencies, Fitch and S&P.

The International Monetary Fund has forecast the Turkish economy to grow by 3 percent in 2025 and 3.3 percent in 2026.