Turkey: Political unrest weighs on business confidence
January 27, 2014
The Real Sector Confidence Index published by the Central Bank fell from 102.1 points in December to 101.4 points in January, marking the lowest level since December 2012. Despite the fall, business sentiment remains above the 100-point threshold, which indicates an optimistic outlook for economic activity.
Ongoing political unrest in the country and a Turkish lira in freefall continue to weigh on business confidence, with the general business situation indicator tumbling to its lowest level since March 2009. The total amount of orders over the past three months also experienced a sizeable drop. Conversely, businesses' views regarding both the expected volume of output and export orders over the next three months improved markedly, suggesting a brighter outlook for the near future.
FocusEconomics Consensus Forecast panelists see fixed investment growth at 3.4% in 2014, which is down 0.7 percentage points compared to last month's estimate. In 2015, panelists expect investment growth to accelerate to 5.9%.