Monday September 17 2018
Turkish Jobless Rate Holds Steady at 10.2% in June
Turkstat | Joana Ferreira | joana.ferreira@tradingeconomics.com

The Turkish unemployment rate came in at 10.2 percent in June 2018, unchanged from the previous year's figure.

The number of unemployed increased 2 percent from a year earlier to 3.315 million in June, and employment rose 2.1 percent to 29.314 million. Meanwhile, the number of people detached from the labour force went up 0.3 percent to 29.997 million. The participation rate increased to 53.8 percent in June from 53.4 percent a year ago, and the employment rate advanced to 48.4 percent from 48.0 percent.

The non-agricultural jobless rate edged down to 12.1 percent in June from 12.2 percent in the previous year. The non-farm sector added 744 thousand jobs, namely in industry and services while the farm sector lost 133 thousand jobs and the number of construction workers also declined.

Youth unemployment rate, measuring job-seekers between 15 and 24 years old, dropped to 19.4 percent from 20.6 percent in the same month a year ago.

On a seasonally adjusted basis, the unemployment rate rose to 10.9 percent in June from 10.6 percent in May.




Thursday September 13 2018
Turkey Hikes Policy Rate to 24%
Central Bank of Turkey | Stefanie Moya | stefanie.moya@tradingeconomics.com

The Central Bank of Turkey raised its benchmark interest rate by 625 bps to 24 percent on September 13th 2018, surprising markets who expected a hike of 425 bps. The move pushed the borrowing costs to the highest since 2004 and was aimed to support the economy and falling currency.

Statement by the Central Bank of the Republic of Turkey:

Recently released data indicate a more significant rebalancing trend in the economic activity. External demand maintains its strength, while slowdown in domestic demand accelerates.

Recent developments regarding the inflation outlook point to significant risks to price stability. Price increases have shown a generalized pattern across subsectors, reflecting the movements in exchange rates. Deterioration in the pricing behavior continues to pose upside risks on the inflation outlook, despite weaker domestic demand conditions. Accordingly, the Committee has decided to implement a strong monetary tightening to support price stability.

The Central Bank will continue to use all available instruments in pursuit of the price stability objective. Tight stance in monetary policy will be maintained decisively until inflation outlook displays a significant improvement. Inflation expectations, pricing behavior, lagged impact of recent monetary policy decisions, contribution of fiscal policy to rebalancing process, and other factors affecting inflation will be closely monitored and, if needed, further monetary tightening will be delivered.




Monday September 10 2018
Turkish GDP Growth Slows to 5.2% in Q2
Turkish Statistical Institute | Joana Ferreira | joana.ferreira@tradingeconomics.com

The Turkish economy grew by 5.2 percent year-on-year in the second quarter of 2018, easing from a downwardly revised 7.3 percent expansion in the previous three-month period. It was the weakest growth rate since the last quarter of 2016.

On the expenditure side, household consumption increased 6.3 percent in the second quarter, after a 9.3 percent jump in Q1; and fixed investment rose 3.9 percent, following a 7.9 percent climb in the previous period. Meanwhile, government spending went up at a faster 7.2 percent (vs 4.9 percent in Q1), and net external demand contributed positively to the GDP growth, as exports surged 4.5 percent (vs 0.7 percent in Q1) buyoed by a persistent currency weakness and imports advanced at a much softer 0.3 percent (vs 15.4 percent in Q1).

On the production side, services output grew 8 percent (vs 10.4 percent in Q1), mainly boosted by public administration, education, human health and social work activities (13.1 percent vs 4.5 percent); financial and insurance activities (12.1 percent vs 3 percent); and information and communication (7 percent vs 5.9 percent) On the other hand, a slowdown was seen in real estate activities (0.2 percent vs 3.4 percent), and a contraction was recorded in professional, administrative and support service activities (-1.3 percent vs 12.1 percent). Industrial production grew by 4.3 percent (vs 8.1 percent in Q1), driven by manufacturing (4.7 percent vs 8.7 percent), and construction output advanced by 0.8 percent (vs 6.6 percent). Meanwhile, agiculture shrank by 1.5 percent after a 6.1 percent increase in the previous period.

On a seasonally adjusted quarterly basis, the economy expanded by 0.9 percent in the second quarter, following a downwardly revised 1.5 percent growth in the previous period.




Monday September 03 2018
Turkey Central Bank Hints at Rate Hike
Central Bank of Turkey | Joana Ferreira | joana.ferreira@tradingeconomics.com

Turkey's central bank said on Monday the monetary policy stance will be adjusted at its September meeting in an attempt to support the lira, after data showed inflation jumped to its highest level since December 2003 amid a currency crisis.

The lira has already fallen some 40 percent against the dollar so far this year, largely due to worries about President Erdogan's influence over the economy, his repeated calls for lower interest rates despite high inflation and worsening rift with the US.

Press Release on Monetary Policy:

Recent developments regarding the inflation outlook indicate significant risks to price stability.

The Central Bank will take the necessary actions to support price stability.

Accordingly, in line with the previous communication, monetary stance will be adjusted at the September Monetary Policy Committee Meeting in view of the latest developments.

The Central Bank will continue to use all available instruments in pursuit of the price stability objective.


Monday September 03 2018
Turkish Inflation Rate Hits New 14-1/2-Year High
Turkish Statistical Institute | Joana Ferreira | joana.ferreira@tradingeconomics.com

The Turkish consumer price inflation rose to 17.90 percent year-on-year in August 2018 from 15.85 percent in the previous month, and below market expectations of 21.50 percent. Still, inflation remained well above the central bank's target of 5 percent and hit the highest level since December 2003 as the lira slumped to fresh record lows amid a currency crisis.

Main upward pressure came from: food and non-alcoholic beverages (19.75 percent vs 19.40 percent in July); transportation (27.13 percent vs 24.21 percent); housing and utilities (16.30 percent vs 12.78 percent); furnishing, household equipment, routine maintenance of the house (23.76 percent vs 20.32 percent); hotels, cafes and restaurants (14.83 percent vs 13.86 percent); clothing and footwear (13.59 percent vs 11.85 percent); alcoholic beverages and tobacco (1.81 percent vs 1.43 percent); and miscellaneous goods and services (23.23 percent vs 17.24 percent).

Annual core inflation rate, which excludes energy, food and non-alcoholic beverages, alcoholic beverages, tobacco and gold, rose to an all-time high of 17.22 percent in August from 15.10 percent in the previous month.

On a monthly basis, consumer prices jumped 2.30 percent in August, following a 0.55 percent rise in July and beating market expectations of 2.23 percent. The sharpest increases were recorded for miscellaneous goods and services (5.85 percent), furnishing and household equipment (4.56 percent), transportation (4.45 percent), housing (3.85 percent) and communication (2.63 percent).




Wednesday August 29 2018
Turkey Trade Deficit Narrows 32.6% YoY in July
Turkish Statistical Institute | Stefanie Moya | stefanie.moya@tradingeconomics.com

Turkish trade gap narrowed 32.6 percent year-on-year to USD 5.98 billion in July of 2018 from USD 8.88 billion in the same month a year earlier, as imports fell while exports increased.

Exports rose 11.6 percent to USD 14.08 billion. Sales of manufactured products which accounted for 94.9 percent of total shipments edged up 11.9 percent. The ratio of high technology products in manufacturing industries was 2.8 percent and the ratio of medium-high-technology was 37.1 percent. Also, sales advanced for agriculture and forestry (8.1 percent) and fisheries (9.5 percent). Meanwhile, exports went down for mining and quarrying (-0.2 percent). Among major export partners, shipments increased for Germany (6.9 percent), the UK (24.6 percent), the US (33.3 percent), Italy (8.6 percent) and France (24.5 percent). In contrast, exports decreased to Iraq (-10.3 percent), UAE (-72.8 percent), Saudi Arabia (-9.9 percent) and Iran (-30.3 percent).

Imports dropped 6.7 percent to USD 20.06 billion. Purchases of intermediate goods accounted for 75.8 percent of total imports in July and decreased by 4.5 percent. Additionally, purchases declined for capital goods (-9.0 percent); consumption (-15.3 percent) and others (-57.9 percent). Imports decreased mainly from China (-7.4 percent), Germany (-7.5 percent), the US (-18.4 percent), Italy (-19.8 percent) and Iran (-01.1 percent). On the other hand, purchases advanced from Russia (4.8 percent), India (91.6 percent), Spain (35.5 percent), Brazil (77.3 percent) and Japan (1.1 percent).

Considering the first seven months of the year, exports increased 7.0 percent and imports went up 10.2 percent, thus widening the trade deficit by 17.4 percent to USD 46.75 billion.

Compared with the previous month, seasonally and calendar adjusted exports advanced by 5.1 percent while imports decreased by 1.3 percent.




Wednesday August 15 2018
Turkish Jobless Rate Drops to 9.7%
Turkstat | Joana Ferreira | joana.ferreira@tradingeconomics.com

The Turkish unemployment rate in Turkey fell to 9.7 percent in May 2018 from 10.2 percent in the corresponding month a year earlier.

The number of unemployed declined 2.8 percent from a year earlier to 3.136 million in May, and employment rose 2.3 percent to 29.138 million. Meanwhile, the number of people detached from the labour force went up 0.8 percent to 28.297 million. The participation rate increased to 53.3 percent in May from 53.0 percent a year ago, and the employment rate advanced to 48.1 percent from 47.7 percent.

The non-agricultural jobless rate also decreased to 11.6 percent in May from 12.2 percent in the previous year. The non-farm sector added 747 thousand jobs, namely in industry and services while the farm sector lost 97 thousand jobs and the number of construction workers also declined.

Among youth, the unemployment rate dropped to 17.8 percent in May from 19.8 percent a year earlier.

On a seasonally adjusted basis, the unemployment rate rose to 10.6 percent in May from 10.3 percent in April.


Monday August 13 2018
Turkey Cuts Lira RRR by 250Bps
Central Bank of Turkey | Rida | rida@tradingeconomics.com

Turkey's central bank cut lira reserve requirement ratios by 250 basis points for all maturity brackets and lowered reserve requirement ratios for non-core FX liabilities by 400 basis points for up to 3-year maturities, the central bank said in a statement.

The measures were taken to support financial stability and to sustain the effective functioning of markets, as the country will start implementing an economic action plan following the tumbling lira. The currency has lost more than 40 percent against the dollar so far this year, largely due to worries about President Erdogan's influence over the economy, his repeated calls for lower interest rates in the face of high inflation and worsening ties with the US.

Press Release on Reserve Requirements:

To support effective functioning of financial markets and flexibility of the banks in their liquidity management;

  • Turkish lira reserve requirement ratios have been reduced by 250 basis points for all maturity brackets.
  • Reserve requirement ratios for non-core FX liabilities have been reduced by 400 basis points for up to 3-year maturities.
  • The maximum average maintenance facility for FX liabilities has been raised to 8 percent.
  • In addition to US dollars, euro can be used for the maintenance against Turkish lira reserves under the reserve options mechanism.
With this revision, approximately 10 billion TL, 6 billion US dollars, and 3 billion US dollars equivalent of gold liquidity will be provided to the financial system.


Friday August 03 2018
Turkey Inflation Rate Highest Since 2004
Turkish Statistical Institute | Stefanie Moya | stefanie.moya@tradingeconomics.com

The annual inflation rate in Turkey increased to 15.85 percent in July of 2018 from 15.35 percent in June. It was the highest inflation rate since January of 2004, mainly boosted by higher prices of food and non-alcoholic beverages and housing and utilities.

Year-on-year, cost rose faster for food and non-alcoholic beverages (19.40 percent compared to 18.89 in June); housing and utilities (12.78 percent compared to 12.04 percent); furnishing, household equipment, routine maintenance of the house (20.32 percent compared to 18.91 percent); hotels, cafes and restaurants (13.86 percent compared to 13.30 percent); clothing and footwear (11.85 percent compared to 11.34 percent); alcoholic beverages and tobacco (1.43 percent compared to 1.06 percent); miscellaneous goods and services (17.24 percent compared to 16.79 percent); communication (4.69 percent compared to 4.94 percent); recreation and culture (9.67 percent compared to 9.39 percent); education (10.81 percent compared to 10.79 percent) and health (11.78 percent compared to 10.83 percent).

On the other hand, cost of transportation eased to 24.21 percent in July from 24.26 percent in June.  

Annual core inflation rate, which excludes energy, food and non-alcoholic beverages, alcoholic beverages, tobacco and gold, edged up to an all-time high of 15.01 percent in July from 14.60 percent in the prior month.

On a monthly basis, consumer prices advanced 0.55 percent in July, slowing from a 2.61 percent in the previous month and below market expectations of a 0.9 percent gain. Cost fell for food and non-alcoholic beverages (-0.28 percent compared to 5.98 percent) and communication (-0.11 percent compared to 4.76 percent) and prices went up at a softer pace for transportation (1.09 percent compared to 2.66 percent); furnishing and household equipment (1.82 percent compared to 2.24 percent) and recreation and culture (1.62 percent compared to 2.16 percent).


Tuesday July 31 2018
Turkey Trade Deficit Falls on Lower Imports
Turkish Statistical Institute | Joana Taborda | joana.taborda@tradingeconomics.com

Turkish trade gap narrowed 9.1 percent year-on-year to USD 5.5 billion in June of 2018. Imports fell faster than exports, mainly due to lower purchases from China.

Exports fell 1.3 percent to USD 12.95 billion. Sales of manufactured products which accounted for 94.3 percent of total shipments went down 1.6 percent. The ratio of high-technology products in manufacturing industries was 3.2 percent and the ratio of medium-high-technology was 37.6 percent. Sales also fell for agriculture and forestry (-1.9 percent). In contrast, exports rose for mining and quarrying (9.3 percent) and fisheries (8.3 percent). Among major export partners, shipments fell for the US (-30.4 percent), Iraq (-8.9 percent), UAE (-73.7 percent), Bulgaria (-26.4 percent), Saudi Arabia (-6.7 percent) and Iran (-30.8 percent). On the other hand, exports increased to Germany (0.8 percent), the UK (9.5 percent), Italy (11.1 percent), France (7 percent) and Spain (14.5 percent). 

Imports went down at a faster 3.8 percent to USD 18.45 billion. Purchases of intermediate goods accounted for 74 percent of total imports and declined 2.5 percent; capital goods fell 6.3 percent and consumption goods plunged 13.9 percent. Purchases dropped mainly from China (-4.5 percent), Italy (-10.4 percent), the UK (-9.3 percent), Spain (-9.8 percent) and Iran (-39.8 percent) but rose from Russia (29.5 percent), Germany (9.2 percent), the US (7.9 percent) and India (18.5 percent). 

Considering the first six months of the year, exports increased 6.3 percent and imports jumped 13.5 percent, thus widening the trade gap by 31.6 percent to USD 40.7 billion.

Compared with the previous month, seasonally and calendar adjusted exports decreasedd by 2.1 percent and imports went down by 5.5 percent.