Turkey | The economy grew by 1.8% in 2020

Summary

Turkish economy grew by 5.9% yoy in 4Q20, bringing the full year GDP growth to 1.8% in 2020. We maintain our 2021 GDP forecast at 5% with some upside risks, given the current strong momentum.

Key points

• Key points:
• Domestic demand gave a robust contribution of 6.5pp, while net exports dragged down a limited 0.6pp from the annual GDP growth rate in 4Q20. After displaying a positive contribution to GDP in the previous 5 quarters, stocks this time posed -1.8pp contribution.
• In 2020, domestic demand gave a strong 7.2pp contribution (3.4pp from stocks) to GDP, while net exports subtracted from growth by 5.5pp in 2020.
• Our monthly GDP indicator nowcasts a yearly GDP growth rate of 5.7% as of February, which we expect to come down to 3-4% with the incoming data referring to the rest of 1Q21.

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