Turkey: Business confidence deteriorates further in August
August 25, 2011
The Central Bank's Real Sector Confidence Index, which tracks short-term tendencies in the manufacturing industry, dropped from 114.1 points in July to 109.8 points in August. With the monthly drop, the index moved closer to the 100-point threshold that separates optimistic from pessimistic territory, suggesting weakening conditions within the business community. Nonetheless, the index remains in optimistic territory, which indicates fixed investment growth will remain positive going forward. The deterioration in business sentiment reflected rising pessimism regarding current total orders as well as concerns over output volume in the coming quarter, which suggests softer economic activity at the outset of the third. In addition, fixed investment expenditures deteriorated after last month's improvement.