Turkey posts current account surplus

ANKARA

Turkey ran a current account surplus of $95 million in September, contrary to an expected $27 million deficit, marking the second time the country recorded a surplus in the balance of payments since 2009.

The 12-month rolling current account deficit stood at $40.6 billion, or about 5 percent of the GDP.

The Turkish Lira slightly gained after the announcement on Nov. 11, trading at 2.88 against the dollar. 

The official figure for August was also revised to a $27-million surplus from the initial $163 million gap, which resulted in the country posting a surplus for two months in a row. 

However, the figures do not stand as entirely good news for the economy, as a core reason behind the change was a decrease in imports, which derives from a stall in consumption and an economic slowdown. 
A drop in oil prices also supported the fall. 

Central Bank data showed Turkish imports stood at 14.9 billion liras in September, the lowest figure in 2015. However, exports also dropped 15.5 percent to 12.3 billion liras in September compared to the same month of the previous year. 

Nearly $2 billion in cash from an “unknown source,” as registered by the Central Bank, also played a positive role in the surplus. 

Işık FX Research said in a note to investors that the fall in portfolio investments and direct investments indicated the exit of foreigners from Turkey continued, as cash inflows were decreasing. The forex firm also raised concerns over the fall in reserves. 

“Improving economic activity combined with low commodities and energy prices to build the surplus,” commented Bora Tamer Yılmaz, an economist with Ziraat Securities in Istanbul.

Improving Turkish trade volumes, and the low-valued lira, also contributed to building the surplus, Yılmaz added. “This is an important change for Turkey, which usually runs a wide deficit,” he said.

Economist Haluk Bürümcekci, formerly with Burgan Securities, said the current account also improved when energy and gold were stripped out.

Bürümcekci forecasted that the end-of-year deficit would stand at about $36 billion. “But the slow recovery in Europe could worsen this scenario,” he added.