Current account posts surplus for four months in a row

ISTANBUL

The current account balance has posted a surplus for a fourth consecutive month in September, data from the Central Bank has shown.

In September, Türkiye posted a current account surplus of $2.99 billion, higher than economists’ expectation of a $2.7 billion surplus for the month.

The current account surplus rose from $769 million in June to $1.45 billion in July and to $4.85 billion in August.

“We expect the annual current account deficit to decline to 0.8 percent of GDP in the third quarter and the downward trend to continue in the final quarter,” Finance Minister Mehmet Şimşek wrote on X, commenting on the latest data from the Central Bank.

The improved current account balance, reduced external financing needs and increased capital inflows contribute to reserve accumulation and support macro stability, Şimşek said.

The annual current account deficit, which decreased by $46 billion compared to May 2023, fell to its lowest level in 33 months, the minister noted.

“The strong outlook for external financing continues. Portfolio inflows were $2.9 billion were in September and $28 billion in the first nine months. During this period, the external debt rollover ratios of banks and real sectors reached 166 percent and 138 percent, respectively,” Şimşek added.

Excluding gold and energy, the current account posted a net surplus of $7.73 billion, the Central Bank said on Nov. 12.

Exports and imports were at $21.7 billion and $24.8 billion, respectively, leading to a goods deficit of $3.1 billion, up from the previous month’s gap of $2.88 billion.

Services recorded a net inflow of $7.39 billion in September.

Under services, travel items recorded a net inflow of $5.97 billion, with the inflows in the January-September period amounting to $37.76 billion, up from $33.34 billion a year ago.

Non-residents’ transactions on equity securities recorded net sales of $83 million and government domestic debt securities recorded net purchases of $1.73 billion, the Central Bank said.

Direct investment recorded a net inflow of $649 million in September, while direct investment inflows in the first 9 months of 2024 were $3.44 billion against the inflows of $2.77 billion in the same period of last year.

Non-resident banks’ deposit accounts held within domestic banks increased by $363 million, with a decrease of $182 million in foreign currency and an increase of $545 million in Turkish Lira accounts.

Official reserves decreased by $719 million in September, which came on top of the $2.5 billion decline recorded in the previous month.

In January-September, the current account balance ran a deficit of $5.27 billion, significantly lower than the current account deficit of $36.1 billion in the same period of 2023.