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Ouch! The toll of corona-contraction getting visible

All combined, Turkey's GDP seems set to shrink to a tune of 8-9% in the second quarter following roughly 7.5% GDP growth in the first quarter of 2020. The numbers will be subject to revision depending on the course of event related to lockdowns during May and June.

Ouch! The toll of corona-contraction getting visible

The results show the degree of blow the Turkish economy has gotten from the coronavirus related lockdowns. Today’s data was on April capacity utilization, real sector confidence index and the confidence indices for the services, manufacturing and the construction sectors.  All point to a dramatic halt in the daily economic activities in Turkey which is no surprise of course.  All combined, Turkey’s GDP seems set to shrink to a tune of 8-9% in the second quarter following roughly 7.5% GDP growth in the first quarter of 2020.  The numbers will be subject to revision depending on the course of event related to lockdowns during May and June.

Turkey’s seasonally adjusted capacity utilization rate in April dramatically dived to 61.9% from 76.2% in March (to 61.6% from 75.3% in non-adjusted terms); which corresponds to the lowest level since the global financial crisis.

The real sector confidence index for April similarly crashed to 66.8 from 99.7 in April, as the orders from home and the exports markets came to a sudden stop while the stocks of goods remained piled up. the current level also corresponds to the lowest simnce the global financial crisis back in 2009.

Seasonally adjusted confidence index decreased by 50.1% in services, 26.0% in retail trade and 42.2% in construction sectors in April compared to the previous month.

Seasonally adjusted sectoral confidence indices, April 2020

Seasonally adjusted  services sector confidence index which was 92.5 in March decreased by 50.1% in April to 46.1. In services sector compared to the previous month, demand-turnover over past three months sub-index decreased by 45.9% to 48.3. Business situation over past three months sub-index decreased by 47.1% to 47.9 and demand-turnover expectation over next three months sub-index decreased by 56.8% to 42.2.

Seasonally adjusted retail trade confidence index decreased by 26.0% in April to 75.2. In retail trade sector compared to the previous month, current volume of stock sub-index increased by 9.7% to 118.5. Business activity-sales over past three months sub-index decreased by 39.9% to 56.7 and business activity-sales expectation over next three months sub-index decreased by 50.8% to 50.5.

Seasonally adjusted construction confidence index which was 77.2 in previous month decreased by 42.2% in April to 44.7. In construction sector compared to the previous month, total employment expectation over next three months sub-index decreased by 40.9% to 55.1. Current overall order books sub-index became 34.2 by decreasing 44.1%.

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