Turkey | “Technical recession” is over but risks are alive

Summary

IP contracted by 2.2% yoy in calendar adjusted terms in March (-4.4% Consensus & -4.6% BBVA Research). Our monthly GDP indicator nowcasts a yearly contraction of 1.7% in March (96% info) and 1.6% in April (47% info). A prudent policy mix remains key to maintain the recovery trend alive and avoid a “W” pattern.

Key points

• Key points:
• Technical recession is over (we expect near 2% qoq GDP growth for 1Q19)
• Increasing uncertainty pose some risks. Complacency should be ruled out
• Avoiding policy mistakes and sticking to prudent economic policies are key ingredients to maintain the recovery trend alive.

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