Turkey: Economy slows in Q1
June 10, 2015
In Q1, GDP rose 2.3% over the same quarter of the previous year, which was below the 2.6% increase recorded in Q4. Nevertheless, the reading came in above the 1.7% expansion the market had expected.
The result tallied in Q1 reflected a worse performance of the external sector while domestic demand improved. Growth in private consumption accelerated from 2.4% in Q4 to 4.5% in Q1. In addition, government consumption picked up pace, rising from a 1.7% expansion to a 2.5% Q1. In addition, fixed investment improved from a 1.0% contraction to flat growth in Q1.
Exports of goods and services contracted 0.3% in Q1, which contrasted the 3.4% expansion recorded in Q4 and marked the worst result in over one year. Imports expanded 4.1%, which was below the previous quarter’s 4.6% increase. As a result, the external sector’s net contribution to overall growth fell from minus 0.4 percentage points in Q4 to minus 1.2 percentage points in Q1.
A quarter-on-quarter analysis does not corroborate the deceleration suggested by the annual figures. GDP rose 1.3% over the previous quarter in seasonally- and calendar-day adjusted terms. The reading was up from the 0.8% increase observed in Q4.