Page 11 - TURKRptJul22

In May, a limited recovery in external balances was expected as gas bills would decline and the tourism season began. However, a record $11bn trade deficit was reported for May. The June deficit was reported at $8bn.
So, the summer decline in gas imports is not producing the expected recovery in trade balance. The central bankers should now work harder to write bigger tourism revenues for a recovery in the current account deficit.
● USD/TRY: Latest record - 18.8760 recorded on December 1. Since June 27, USD/TRY has remained below the 17-level.
Turkey’s 5-year credit default swaps (CDS), meanwhile, hit 872 on June 14 while the yield on the Turkish government’s 10-year eurobonds is testing the 11%-level.
● Balance of Payments: The current account deficit ran wild again and hopes are pinned on tourism revenues in the summer.
Financial flows stopped; as a result, they are stable. Turks are waking up as the USD/TRY rate is rising again.
Debt-rollovers continue undeterred but with no fresh inflow. Eurobond auctions stopped in March. Net FDI remains around zero. Nothing much comes via unidentified flows channel.
11 TURKEY Country Report July 2022 www.intellinews.com