Current account gap narrows 76 percent

ANKARA-Anadolu Agency

Turkey’s current account gap fell by 76 percent in April this year, the country’s Central Bank announced on June 14.

In April, the current account balance posted a $1.3 billion deficit, improving from a $5.6 billion deficit in the same month last year.

Official figures also revealed that the country’s 12-month rolling deficit amounted to $8.6 billion.

“This development in the current account is mainly attributable to $3.65 billion decrease in the goods deficit recording net outflow of $1.84 billion,” the Central Bank said.

Treasury and Finance Minister Berat Albayrak said on June 3 that Turkey is likely to post a current account surplus in June.

“We will strengthen our production and export-led economic model with steps in every area, and put the current account issue out of our agenda,” he said.

The Central Bank also attributed the fall in the current account shortfall in April to $263 million decrease in primary income deficit to $1.24 billion as well as $401 million increase in services surplus to $1.73 billion.

It noted that gold and energy excluded current account indicated $2.34 billion surplus, in contrast to $1.58 billion deficit a year ago.

Travel item under services recorded a net inflow of $1.15 billion in April, increasing by $144 million year-on-year, the Central Bank added.

Last year, the current account balance posted a deficit of around $27.6 billion, improving from a nearly $47.5 billion deficit in 2017.

The figure was the lowest since 2009, while Turkey’s highest annual current account deficit over the last decade was seen in 2011, with $74.4 billion.

The country’s new economic program, announced last September, targets a current-account-deficit-to-GDP ratio of 3.3 percent this year.

On a related note, current account deficit expectations for 2019 declined to $10.6 billion in June, from $14.7 billion in the previous month, the Central Bank’s monthly survey showed on June 14.

The participaints of the survey also slashed their current account gap forecast for 2020 to $19.2 billion from $22 billion.

According to the survey, the annual inflation is expected to be 15..85 percent at the end of this year, an improvement from the previous month’s forecast of 16.68 percent.

Consumer prices are expected to increase by 0.91 percent on a monthly basis in June, while the monthly inflation rate is forecast to be 0.94 percent in July, the bank said.