Turkey latest publications
The high uncertainty triggered by the Covid-19 crisis has stressed the need to monitor the evolution of the economy in “real time”. We developed a set of Big Data indicators to track Investment in Real Time and High Definition, extending the analysis to assess the business cycle and complementing our tracker of consumption.
Consumer prices increased by 0.86% mom in August, leading the annual inflation to stay almost stable at 11.77%. Annual core inflation rose to 11.03% from 10.25%, reflecting gradual exchange rate pass-thru and the impact of the demand pull factors. We expect the headline inflation to be 11% at the end of 2020.
Turkish economy contracted by -9.9% in yearly terms in 2Q20. The growth rates in services and industry, sensitive to the Covid-19 shock, were the key factors behind. We revise our 2020 GDP growth forecast to -1% from the previous 0%, keeping the same forecast range from -3% to +1%.
Industrial Production (cal. adj.) grew +0.1% yoy in June, impliying a faster recovery after the sharp drop of 25% during April-May. Our monthly GDP indicator nowcasts a yearly GDP growth rate of near -5.5% for 2Q, and +0.4% as of July. We maintain our 2020 GDP growth forecast at 0% with some risks on the downside
Consumer prices increased by 0.58% in July, this time surprising on the downside (1% BBVA Research vs. 0.8% Consensus). Led by the positive base effects, annual inflation decelerated to 11.76% from 12.62% in June. We expect consumer inflation to stay at two-digits and to be realized at 10% at the end of the year
Industrial Production (IP) in May contracted by 20% yoy in calendar adjusted terms, which signals a gradual recovery after the sharp drop of 31% in April. The month-on-month recovery at 17% also proved to be the strongest monthly increase historically. We maintain our GDP growth estimate at 0% for 2020.
Consumer prices increased by 1.13% in June, remaining significantly above both the consensus and our expectation (0.6% vs. 0.45%). Thus, also led by the negative base effects, annual inflation accelerated to 12.62% from 11.39% in May.
Industrial Production (IP) in April contracted by 31.4% yoy as the restrictions and the impact of the COVID on the activity intensified during the month. We maintain our GDP growth estimate at 0% for 2020 and wait for June’s indicators to confirm the pace of recovery. Important down side risks remain.