Page 24 - TURKRptJul19

materials industry may even hit 15% in Q2. In the first quarter of 2019, the Turkish economy shrank 2.6% y/y while the construction sector, once hailed as the engine of economic growth, contracted 10.9% from a year ago.
4.0 Real Economy
Turkey - GDP breakdown (%)
2016
2017
2018
Q1/18
Q2/18
Q3/18
Q4/18
Q1/19
GDP Growth (y/y)
3.18
7.44
2.57
7.36
5.35
1.84
-2.98
-2.62
By Production -Agriculture
-2.58
4.88
1.32
7.27
-1.07
1.84
-0.46
2.53
Industry
4.20
9.11
1.06
7.90
4.00
0.13
-6.36
-4.34
Construction
5.40
9.00
-1.92
7.99
1.50
-5.57
-8.70
-10.89
Services
0.20
10.90
5.61
10.48
8.92
4.81
-0.26
-4.00
By Expenditure - Private Consumption
3.70
6.10
1.15
8.95
5.84
0.79
-8.90
-4.71
Government Consumption
9.50
5.01
3.59
3.49
7.80
3.42
0.46
7.22
Gross Fixed Capital Formation
2.20
7.81
-1.73
8.81
4.78
-4.75
-12.90
-13.01
Exports
-1.90
11.94
7.49
0.74
4.15
13.64
10.56
9.47
Imports (-)
3.70
10.32
-7.95
15.38
0.14
-16.76
-24.40
-28.82
source: tuik
4.1 Industrial production
Turkey’s calendar-adjusted industrial production index contracted for an eighth consecutive month in April, data from national statistics office TUIK showed on June 18. It posted a 4% y/y decline in the fourth month after registering a revised 2% y/y contraction in March, the lowest of the decreases registered across the eight-month-long uninterrupted period of contraction seen since September. Prior to the industrial data release, a Reuters poll predicted a 2.5% y/y fall in the calendar-adjusted industrial output index for April. Analysts are weighing up whether Turkey can avoid a double-dip recession. The economy contracted 2.6% in the first quarter after a 3% drop in the last quarter of 2018. Economic activity has remained slow since, with the central bank's policy rate having not budged from 24% since September.
PMI records another fall. The latest manufacturing purchasing managers’ index (PMI) survey from the Istanbul Chamber of Industry and IHS Markit shows the index falling to 45.3 in May from 46.8 in April (50.0 is the threshold
24 TURKEY Country Report July 2019 www.intellinews.com