Mar 14 2019

Turkey’s industrial output rises for first time since currency crisis

Turkey's industrial output climbed on a monthly basis for the first time since a currency crisis peaked in August.

Output rose 1 percent in January compared with December, led by a 2.1 percent increase in the production of intermediate goods and medium-low technology products, the Turkish Statistical Institute said on Thursday. It was the first increase since July.

Turkey’s economy has tipped into a recession from runaway growth early last year just as the ruling Justice and Development Party (AKP) prepares to contest local elections on March 31. The downturn was sparked by concerns about economic overheating and a political crisis with the United States over the detention of a U.S. pastor. The lira slumped to a record low against the dollar in August.

Industrial output fell 7.3 percent compared with January last year, showing the depth of the decline in Turkey’s economic activity. It was the fifth-straight month of contraction. Output had fallen a yearly 9.8 percent in December.

Economists are warning of a protracted economic recession in Turkey, pointing to a slump in consumer demand, rising bankruptcies and a growing stock of bad loans in the banking system. Treasury and Finance Minister Berat Albayrak said this week that the worst of the economic downturn was over.

The economy shrank by 2.4 percent on a quarterly basis in the three months to December after a 1.6 percent contraction in the previous quarter, the statistics institute said on Monday.