Turkey | Activity confirms an upward trend

Summary

Industrial Production continued to surprise on the upside and grew 10.8% y/y in calendar adjusted terms in April. If no substantial negative shock occurs, given the current pace, it becomes more likely to achieve a full year growth rate close to 5%.

Key points

• Key points:
• The monthly contraction in intermediate, consumer, and energy goods production were offset by the recovery in capital goods production, resulting in a stable overall figure in April.
• Despite the spill-over effects from the war in Ukraine and tighter global financial conditions, activity remains solid so far on the back of extra loose monetary policy, continuing credit and fiscal impulses and other supportive economic policies.
• Our big data demand indicators show that private consumption stays solid, led by the continuation of brought forward demand on top of expansionary policies.
• Our nowcasts indicate that the economy has already grown near 7% y/y in the first half of the year with still strong depletion from inventories in 2Q22, which should be changing in the next quarters and keeping inflationary risks alive.

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