Turkish industry activity grows by 6.7% in June

According to a Reuters poll released on Friday, Turkey’s industrial production is predicted to grow by 6.7% yearly in June, continuing a good two-year trend despite high inflation and a weak currency.

 

The output has significantly improved since the initial coronavirus wave in April 2020.

 

In the upcoming months, economists predict that the index’s growth rate would slow. Production could also be impacted by a potential decline in external demand or a disruption in the supply chain brought on by Russia’s invasion of Ukraine.

 

The calendar-adjusted industrial production index increased by 6.7 percent year over year in June, according to the median estimate of six institutions surveyed by Reuters.

 

Forecasts for the index, which is used as a first sign of economic development, varied from 5.5% to 9.9%.

 

Lutfullah Bingol, an economist at Albaraka Turk, warned that the index’s growth would decelerate starting in July, but that a potential recovery in chip shortages in the automotive sector might temper the decline in other sectors for the remainder of the year.

 

‘In July, we anticipate a minor slowing in the industrial production index’s increase. However, if the automobile industry’s chip problem is remedied, it might counterbalance the year’s relative calm in other industries,’ said Bingol.

 

Because of this and the tourism industry’s strong performance, ‘we still predict year-end growth to be over 4%.’

 

Turkey’s GDP expanded by 11% last year, a substantial increase over the previous year. However, a dramatic decline in the value of the lira in December severely disrupted household and business budgets and drove up inflation through import costs.

 

Growth in 2022 is predicted to be hampered by the currency crisis, which caused inflation to surge to 80%, as well as war’s aftereffects.

 

On August 12 at 7:00 GMT, the Turkish Statistical Institute will release data for the month of June’s industrial production.