Turkey rebounding strongly from recession, ING says

The Turkish economy is recovering well from a severe economic downturn sparked by a currency crisis last year, Muhammet Mercan, ING Bank’s chief Turkey economist, said in a report.

Mercan referred to third-quarter economic output data published on Monday, which showed the economy growing by an annual 0.9 percent, the first expansion this year.

“Turkey's economy is rebounding strongly from recession thanks to supportive policies and a weak base from last year,” Mercan said. “Recent high frequency indicators suggest further momentum in the last quarter of 2019.”

Turkish Treasury and Finance Minister Berat Albayrak says that the economy could grow by between 4 percent and 5 percent in the last three months of the year, thanks to the government’s stimulus efforts and the performance of manufacturers and exporters.

"The fourth quarter looks bright," Mercan said.

Mercan said a series of central bank rate cuts – monetary policymakers have slashed interest rates by 10 percentage points to 14 percent since July -- was helping to rejuvenate demand for loans. The economy was also being supported by an easing of political tensions with the United States and the conclusion of local elections in July, he said.

“The bank is seeking to support activity through faster lending and significant easing is reducing yields and making it more affordable to borrow,” Mercan said.

“The end of the election cycle and resultant fall in political uncertainty as well as an improvement in U.S.-Turkey relations have also helped to boost sentiment and hence private consumption.”