ZCZC
BCN-03
TURKEY-ECONOMY-GROWTH-INDICATOR
Turkey economic growth slows
ANKARA, Dec 10, 2018 (BSS/AFP) – Turkey’s economic growth slowed
considerably in the third quarter, official data showed on Monday, reflecting
the effects of the currency crisis and high inflation.
Compared to the third quarter of 2017, the Turkish economy grew by 1.6
percent in the three months to September, figures from the Turkish Statistics
Institute (TUIK) showed.
The figure was substantially lower than the 5.3 percent — revised on
Monday from 5.2 percent in September — recorded in the second quarter.
Seasonally and calendar adjusted the economy contracted by 1.1 percent in
the third quarter compared with the second.
The Turkish lira traded at 5.3 against the dollar on Monday after 0800 GMT,
showing minimal movement from 5.29 before the data release as markets had
expected a slowdown.
The latest figures reflect the dramatic fall in the value of the lira in
August, when it briefly breached seven to the dollar during US-Turkey
tensions and concerns over domestic monetary policy under Turkish President
Recep Tayyip Erdogan.
Since then, Washington and Ankara ties have warmed up following the release
of an American pastor from a Turkish prison in October and the lira has
rallied.
However, inflation surged to 25.24 percent in October, a 15-year high,
before it dropped to 21.62 percent in November.
The rate of increase in consumer prices was 10.35 percent in January this
year.
Jason Tuvey, senior emerging markets economist at London-based Capital
Economics, warned in a note on Monday that the Turkish economy “has probably
entered a technical recession” in the fourth quarter.
A recession is defined as two consecutive quarters of shrinking output
based on a quarter-on-quarter comparison.
Tuvey said that Capital Economics expected the Turkish economy to contract
0.5 percent in 2019, noting that this estimate was “below the consensus
forecast for growth of 0.6 percent.”
BSS/AFP/MR/ 1420 hrs