Turkey’s industrial production drops sharply after failed coup attempt

Industrial output fell 4.9 percent in July, on a calendar-adjusted basis, from the same month last year.

Unadjusted industrial production, which includes calendar effects, tumbled 8.4 percent year-over-year in July, showing the steepest monthly contraction since September 2009, as reported by Reuters. 

Industrial production fell 7 percent from the previous month in July, on both a calendar and seasonally-adjusted basis, due to contractions in various sectors, according to TÜİK data. 

BCG Partners Chief Economist Özgür Altuğ told Reuters that the industrial production seemed to be negatively affected from the decline in work days due to a long public holiday and the failed coup attempt in July. 

“The failed July 15 coup attempt had a dramatic impact over Turkey’s production,” he said. 

Turkey’s industrial production, the most crucial element for growth, rose by 4 percent in the first quarter from the same period of 2015, pushing up the economic growth, before losing speed by the second quarter. 

While analysts noted that the August data should be seen in order to get a clearer signal of economic growth, they emphasized the downward risks over the 2016 growth estimates. 

Meanwhile, the Turkish Purchasing Managers’ Index (PMI), compiled by HIS Markit and the Istanbul Chamber of Industry, also fell to 47 last month from 47.6 in July, according to the data, which was released on Sept. 1. 

Any figure greater than 50 indicates an overall improvement in the sector.

This was the worst slowdown since early 2009, as production and new orders, two indicators of five key PMI indicators, decreased, although the level of new export business rose for the first time in 2016.