Turkey: Business confidence recovers somewhat in November but stays pessimistic
November 26, 2018
The Real Sector Confidence Index published by the Central Bank picked up from 87.6 in October to 92.8 in November, ending a run of seven consecutive monthly declines. However, the index remained below the 100-point threshold that separates optimism from pessimism among firms.
The improvement came on the back of rising confidence regarding total current orders; and output, employment and export orders over the next three months. Firms also rated the general business situation far more positively, likely thanks to a period of calm in financial markets.
In terms of prices, firms’ inflation expectations for the next 12 months finally levelled off—albeit at the elevated level of 28.1%—after rising almost uninterruptedly since the start of 2018. Despite this, elevated inflation expectations continue to present a major challenge for the Central Bank in its efforts to rein in inflation.
Turkey Fixed Investment Forecast
FocusEconomics Consensus Forecast panelists see fixed investment contracting 5.8% next year, before expanding 3.4% in 2020.
Author: Oliver Reynolds, Economist