Capacity usage steady, business confidence falls in June

ANKARA

The manufacturing sector’s capacity utilization rate was unchanged, but business morale deteriorated in June, separate data from the Central Bank have shown.

The unadjusted capacity utilization rate (CUR) in manufacturing was 76.3 percent in June, according to the bank’s Business Tendency Statistics released on June 24.

Companies operating in the durable consumer goods manufacturing sector used 75 percent of their capacity, up from 74.3 percent in May, while the CUR inched up from 73.5 percent to 73.6 percent in the non-durable consumer goods industry.

In the consumer goods sector, companies’ capacity utilization rate rose slightly from 73.6 percent in May to 73.9 percent in June.

Food and beverage companies worked at 73.1 percent capacity, up from 72.5 percent in May, while firms operating in the intermediate goods sector increased their capacity usage from 76.1 percent to 76.3 percent.

In the capital goods manufacturing sector, however, the CUR declined from 76.6 percent to 75.4 percent.

Meanwhile, separate data from the bank showed that business morale continued to deteriorate for the second month in a row.

The real sector confidence index declined from 105.4 in May to 102.8 in June. The index figure was 106.1 in April.

Any figure above the 100 mark indicates optimism among businesses.

The sub-index of the current total amount of orders plunged 5.3 percent month-on-month to 82.1, while an index of finished goods stock rose 0.2 percent to 93.1.

The index of volume of output in the next three months fell 3.6 percent, while the monthly decline in the index of export orders in the next three months was 1.4 percent.

The gauge of fixed investment expenditure dropped 3.5 percent in June from May.

The index showing companies’ assessment of general business situation declined by 2.4 percent month-on-month to 92.7.

The Turkish Statistics Institute (TÜİK) separately reported on June 24 that the seasonally adjusted confidence index in the services sector, which was unchanged in May, fell by 1.5 percent in June to 115.4, driven by the deterioration in business situation over the past three months and demand expectations in the next three months.

In the retail sector, the confidence index declined by 2.6 percent in June after falling 3.3 percent in the previous month. The pace of monthly decline in the sub-index of business volume expectations in the next three months quickened from 2.9 percent to 3.2 percent.

Business morale in the construction sector deteriorated further, with the confidence index falling 0.5 percent month-on-month, which came on top of the 0.3 percent decline in May.