Turkey Business Confidence May 2016

Turkey

Turkey: Business confidence in May recedes slightly from April's 22-month high

May 25, 2016

Although supportive-growth rhetoric from authorities is propelling businesses’ sentiment, recent political turmoil following Prime Minister Ahmet Davutoglu’s resignation has weighted slightly on economic confidence. The Real Sector Confidence Index published by the Central Bank fell from April’s nearly-two-year high of 110.1 to 109.8 in May. Nevertheless, business confidence remains above the 100-threshold and indicates an optimistic outlook for business conditions.

May’s result showed that businesses were slightly less optimistic regarding the total amount of orders, the expected output volume in the next three months, job prospects in the coming three months, export orders in the next three-month period and fixed investment. Moreover, the general business situation deteriorated and dipped below the 100-threshold. Conversely, the total amount of orders in the previous three months climbed to nearly a three-year high.

FocusEconomics Consensus Forecast panelists see fixed investment registering a 3.1% expansion in 2016, which is up 0.1 percentage points compared to last month’s estimate. In 2017, panelists expect investment growth of 4.1%.


Author: Ricard Torné, Lead Economist

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Turkey Business Confidence May 2016

Note: Real Sector Confidence Index. Values above 100 indicate an optimistic outlook while values below 100 indicate a pessimistic outlook.
Source: Central Bank of the Republic of Turkey (CBRT).


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