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consumption was also slightly higher month on month.
In September, the domestic market will feel the effects of the ongoing currency shock. Turkey’s exports are sensitive to demand conditions on export markets but not to Turkish lira depreciation.
4.2 Inflation
The official inflation rate was on September 3 announced as unchanged between July and August, at 11.8% y/y.
The weighted average cost of funding has risen gradually from 7.34% on July 16 to 10.99% on September 28.
4.3 Industrial sectors and trade 4.3.1 PMI Production dynamics
The headline PMI registered 54.3 in August, down from 56.9 in July.
Liam Peach at Capital Economics: “The PMI still points to industrial production growth of around 15% y/y in Q3. The output prices index rose from 57.5 in July to 61.9 in August, its highest since September 2018. This provides signs that
21 TURKEY Country Report October 2020 www.intellinews.com
