Turkish industrial output slips in November

ANKARA – Anadolu Agency

Turkey’s calendar-adjusted industrial production dropped 6.5 percent in November 2018 compared to the same month of the previous year, the country’s statistical institute (TÜİK) announced on Jan. 14.

This was a larger decline than what the market had predicted.

According to a survey conducted by Anadolu Agency’s Finance Desk, a group of 11 economists projected the calendar-adjusted industrial production index to fall 3.1 percent year-on-year.

Among three main sub-indexes, the manufacturing index posted the worst performance in November, down 7.1 percent year-on-year.

The electricity, gas, steam, and air conditioning supply index fell 1.8 percent, while the mining and quarrying index went down 1.1 percent during the same period.

The term “calendar-adjusted” is used to refer to data without calendar and holiday-originating effects.

On a monthly basis, industrial production dropped slightly, 0.3 percent, in November, the data also showed.

Among the sub-sectors of the seasonally and calendar-adjusted industrial sector, the mining and quarrying index fell the most monthly.

The mining and quarrying index dropped 3.7 percent in November, compared to October 2018.

The manufacturing index dropped a slight 0.1 percent month-on-month in November, while the electricity, gas, steam, and air conditioning supply index remained unchanged.

Industrial output is considered a vital indicator for the economy, as it is seen as a preliminary gauge of GDP growth.

In its New Economic Program, announced in September last year, the government forecast that the Turkish economy would grow 3.8 percent in 2018, but the expansion rate would ease to 2.3 percent in 2019.

Turkey’s economy grew by 1.6 percent year-on-year in the third quarter of last year versus the revised expansion rates of 7.2 percent in the first and 5.3 percent in the second quarter of 2018.

On a seasonally and calendar-adjusted basis the country’s GDP contracted by 1.1 percent in the third quarter compared with the previous quarter.

The World Bank recently revised its growth rate forecast for Turkey from 4.5 percent to 3.5 percent for 2018, from 4 percent to 1.6 percent for 2019 and from 3.5 percent to 3 percent for 2020.

The World Bank’s 2021 prediction for Turkey stands at 4.2 percent.

“Despite this contraction [in the third quarter], strong growth in the first half of the year will bring Turkish growth to an estimated 3.5 percent for 2018,” the World Bank said.