The projection that total demand for domestic goods will remain relatively limited due to the negative contribution of the foreign demand, despite the stable increase in domestic final demand throughout 2006, underlies these findings (Graph 25). 18  BIS Review 67/2006  Graph 26. Inflation and Output Gap Forecasts (Constant Interest Rate) 10 9 8 7 6 5 4 3  Forecast Range*  2 1  ± 2 Uncertainty Band  Output Gap  0 -1 -2 7:03  7:02  7:01  6:04  6:03  6:02  6:01  5:04  -3  * The probability of inflation staying within the forecast range is 70 percent. ♦ The path ‘consistent with the target’ which is announced in 5 December 2005 ‘’General Framework of Inflation Targeting Regime and Monetary and Exchange Rate Policy’ and constitutes the base for the principle of “accountability”. • 2006 end-year point target. ♦ The path consistent with the 2007 end-year target, under contemporary data set. In Graph 26, the forecasts that have been produced under a main scenario are presented - in which the current stance, the short-term outlook and the assumptions relating to the fundamental variables the framework of which are given above -are faithfully preserved; however, the policy interest rates are maintained as unchanged for one year starting from today. In contrast to the previous scenario, the path of policy interest rates has not been determined by a medium-term approach, but has been handled as an exogenous assumption.
Public Debt Stock Indicators (Billion YTL) Public Debt Stock Indicators  The Analysis of the Change in the Central Government’s Overall Debt Stock 60  400  120 334.4 100  350  40  300 Percent  80 60  20  250  68.2  200  55.8  0  150  40  100 20  50 0 2006/03  2005  2004  2003  2002  2001  0  Central Government Total Debt Stock (Right axis) Central Government Total Debt Stock/GNP Total Public Net Debt Stock/GNP  -20  2003  2004  2005  P arity Effect**  6.2  3.0  -4.8  2006/03* 0.7  Exchange Rate Effect***  -18.8  -4.6  -0.8  0.0  Fo reign Debt Net Increase  4.0  4.1  -0.6  0.7  Do mestic Debt Net Increase  48.8  31.2  21.1  1.4  * It shows the change compared to 2005. ** It shows the external debt changes resulting from movements in USD/Euro and USD/SDR parities. *** It indicates the changes resulting from movements of New Turkish Lira against USD. Note: It represents the growth in the net increase in debt stock excluded from exchange rate and parity effects. The parity effect is calculated merely for the external debt. Each component of the change in debt stock is calculated as billion YTL. The sum of components corresponds to the nominal change in the overall debt stock expressed in terms of YTL. Source: Treasury, CBRT.