Turkey: I/P increases by 8.5% in October

In October, industrial production in Turkey increased by 8.6% compared to the same month of the previous year, according to calendar adjusted data; Seasonally and calendar adjusted industrial production increased by 0.6% compared to the previous month. According to unadjusted data, industrial production increased by 5.4% compared to the same period of the previous year. Our forecast was for industrial production to increase by 8.6% yoy in October, for adjusted data.

While the general trend on the industrial production side is positive and supports the strong growth outlook on an annual basis, the narrowing trend especially on the capital goods side shows that the growth may lose momentum in the coming periods. Along with the mentioned monthly realizations, the slowdown in capital production seen as of the transition period to 4Q21 means a slowdown in fixed capital investments. This is an issue that we care about especially in terms of the quality and sustainability of growth. We have to monitor the expansion in monetary and fiscal policies and the effects of the post-normalization period. On the other hand, items that lost momentum in the monthly changes in industrial production change rates compared to the previous months may also cause the growth in the last quarter to remain below the previous quarters. In terms of technology breakdown; We observe a 3.8% increase on the low technology side, despite the 2% contraction in the medium-high technology side and the slow monthly growth of 0.4% in the high technology side. This shows that almost all of the growth in the industry comes from the low technology breakdown, and we think that high technology should be considered in terms of the main competitiveness criterion in exports. In terms of production, we consider that the most challenging factor for us at this point is the increase in raw material and energy prices.

When we look at the details; While mining and quarrying contracted by 0.3% on a monthly basis, it increased by 9.2% on an annual basis. While an increase of 0.7% was observed in the manufacturing industry on a monthly basis, there was a growth of 9.2% on an annual basis. In the electricity, gas and steam group, an increase of 0.1% was observed on a monthly basis, while the growth was 3.5% on an annual basis. On a monthly basis, non-durable goods increased by 3.6%, energy by 1.4%, intermediate goods by 1.3% and durable goods by 0.3%. Capital goods contracted by 5.2%. Looking at the annual changes in the related items; Intermediate goods increased by 13.2%, durable consumer goods increased by 10.7%, non-durable consumer goods increased by 8.4%, capital goods increased by 3.9% and energy increased by 1.5%.

We expect growth to be in double digits throughout this year. The trend in the first periods of the year was extremely strong, and we will see growth rates that will continue the general trend periodically compared to the same period of the previous year. On the other hand, we think that there will be a loss of momentum in the economy in the upcoming period. We evaluate the risks on the growth outlook for the next year with a downward weight, in view of both the change in domestic and foreign demand conditions and the outlook for the investment environment. In 2021, our annual GDP growth forecast is 10.5%.

Kaynak Tera Yatırım
Hibya Haber Ajansı