Turkey Manufacturing Downturn Deepens in July

The Istanbul Chamber of Industry Türkiye Manufacturing PMI fell to 47.9 in March 2026 from 49.3 in February. This marked the lowest reading since October 2025, due to sharper slowdowns in both total new orders and export orders amid weaker demand caused by the war in the Middle East. Output also declined to its lowest level since last November. The conflict further intensified inflationary pressures, resulting in higher costs for freight, fuel, and oil. Consequently, input costs and output prices rose at their fastest rates in 23 and 25 months, respectively. Lead times lengthened to the greatest extent since August 2024. Moreover, manufacturers reduced employment to the largest degree in six months and also cut back on purchasing activity and inventory holdings.

The Istanbul Chamber of Industry Türkiye Manufacturing PMI rose to 49.3 in February 2026 from 48.1 in January, signaling a near stabilization in manufacturing activity and the softest contraction since April 2024. New orders edged down only marginally, marking one of the smallest declines since the current downturn began in mid-2023, amid signs of improving demand. Output fell for the twenty-third consecutive month, though at the slowest pace in over a year. At the same time, employment fell for the fifteenth straight month, but at a softer rate than in January. Purchasing activity was broadly unchanged, while inventories of purchases were reduced at a slower pace. On the price front, inflationary pressures intensified, with input costs rising at the fastest pace in nearly two years, driven by higher raw material prices and minimum wage increases. Output price inflation also accelerated to its strongest level since April 2024.

The Istanbul Chamber of Industry Türkiye Manufacturing PMI edged down to 48.1 in January 2026 from 48.9 in December, remaining below the 50.0 threshold for the twenty-second consecutive month. The reading signaled a mild deterioration in manufacturing conditions, with subdued demand as new orders declined further and export orders weakened more sharply than overall business. In response, manufacturers continued to scale back output, extending the downturn in production to nearly two years. Employment and purchasing activity also decreased, reflecting softer workloads and ongoing caution among firms. On the price front, inflationary pressures heightened, with input costs rising at the fastest pace since April 2024 due to higher raw material prices, while output prices climbed at a near two-year high. An analyst at the Istanbul Chamber of Industry commented that manufacturing entered 2026 much as it ended last year, with demand conditions still weak and production slowing.