Turkish industrial confidence climbs to highest level since May 2018

Turkey’s industrial confidence rose to the highest level in almost two and a half years, according to a central bank survey.

Confidence among industrialists increased to 108.1 points in October from 105.3 in September, the central bank said on its website on Monday. That was the most since May 2018, just prior to a currency crisis that swept through financial markets the same summer.

Turkey’s government has reduced taxes, engineered a borrowing boom and allowed some companies to restructure their debts via state-run banks to help the economy recover from the currency crisis and the outbreak of the COVID-19 pandemic.

The improvement in industrial confidence during October came even after the lira sank to successive record lows against the dollar. On Monday, the currency fell to as low as 8.06, taking losses this year to more than 26 percent. A fall in the lira’s value renders imports more expensive but helps Turkish exporters to be more competitive.

The increase in confidence was led by the outlook for fixed income expenditure, which improved to 103.3 from 94.4 in September, the data showed. Confidence among companies about the general economic situation rose to 101.4 from 94.7.

Any reading above 100 reflects optimism among Turkish firms.

Confidence concerning export orders over the next three months fell to 118.5 in October, the lowest level since June, from 123.8 in September.