Consumer morale declines for second consecutive month

ANKARA

Consumer confidence declined for a second month in a row in July, data from the Turkish Statistical Institute (TÜİK) have shown.

The consumer confidence index declined by 3.1 percent in July from the previous month to 75.9 points, which marked the index’s lowest value this year, after declining 2.7 percent in May, TÜİK said on July 23.

Any index value above the 100 mark indicates optimism among consumers.

The sub-index for households’ assessment of their current financial situation was down 5.4 percent month-on-month, a steeper decline compared to the 2.2 percent drop recorded in June.

The gauge of consumers’ financial situation expectations over the next 12 months fell 4.2 percent, after declining 4.4 percent in the previous month, while the index for households’ general economic situation expectations for the next 12 months plunged 7 percent, accelerating from the 2.8 percent decline in June.

The index measuring households’ assessment of their current financial situation compared with the past 12 months nosedived 7.9 percent in July, comparing unfavorably with the 10 percent and 2 percent increases recorded in May and June.

Consumers appeared to be less optimistic about inflation prospects in the next 12 months, showed TÜİK survey.

Consumer spending is one of the main drivers of the economic growth in Türkiye.

Final consumption expenditures of households accounted for 56.6 percent of GDP in the first quarter of 2024. Households’ consumption expenditures rose 7.3 percent in January-March from the same period of 2023.

The rate of GDP growth accelerated from 4 percent in the final quarter of 2023 to 5.7 percent in the three months to March.