Turkey Manufacturing Contraction Deepens

The Istanbul Chamber of Industry Türkiye Manufacturing PMI fell to 47.1 in June from 49.8 in May, signaling a sharper deterioration in manufacturing conditions and extending the sector's downturn to 27 consecutive months. Output contracted again after returning to growth in May, amid weaker demand and market uncertainty stemming from the war in the Middle East. New orders declined further, while new export orders returned to contraction after expanding in May. Employment and purchasing activity also declined in response to softer demand. Meanwhile, suppliers' delivery times lengthened again as the conflict disrupted raw material supplies, although the deterioration was the least marked since February. On prices, both input cost and output price inflation eased for a second straight month, with input cost inflation slowing to the weakest since November despite higher oil and raw material costs. Lastly, inventories of purchases and finished goods declined amid muted demand.

The Istanbul Chamber of Industry Türkiye Manufacturing PMI rose to 49.8 in May 2026 from 45.7 in April. The reading was the highest since March 2024 and signaled a near-stabilization in manufacturing sector conditions. Output returned to growth after falling sharply in April. External demand also improved, with new export orders rising, ending a 20-month period of decline. This helped to cushion the drop in total new orders, which nevertheless fell slightly during the month. Employment levels were reduced for another month, albeit to the smallest extent so far this year. Purchasing activity rose for the first time in over two years as some firms sought to build inventories amid rising costs and supply-chain disruptions caused by the Middle East war. Suppliers' delivery times lengthened further, with vendor performance deteriorating for the seventh month. While input costs continued to rise sharply, the rate of inflation eased, a trend that was also reflected in output prices.

The Istanbul Chamber of Industry Türkiye Manufacturing PMI fell to 45.7 in April 2026 from 47.9 in March, marking the largest deterioration in business conditions since September 2024. The decline reflected intensifying impacts from the war in the Middle East, with firms reporting weaker demand, rising costs, and ongoing supply-chain disruptions. Output contracted at a rate matching the steepest seen since the COVID-19 pandemic, while total new orders and export demand fell more sharply than in the previous month. Inflationary pressures intensified, with input cost inflation accelerating to its fastest pace since January 2024, while output prices rose at the sharpest rate in over two years. Supplier delivery times lengthened significantly, marking the worst deterioration since February 2023. In response, manufacturers reduced employment, purchasing activity, and inventories, with input stock depletion the steepest in six years.