Turkey: Industrial output drops at an accelerated pace in April
The second quarter started off on the wrong foot for the Turkish industrial sector with output falling 4.0% year-on-year in April. The print was down from March’s upwardly revised 2.0% contraction (previously reported: -2.2% year-on-year) and annual average industrial production dropped 2.6% in April, down from the 1.8% fall in March.
The headline figure reflected a significant contraction in mining and quarrying, swinging from a robust expansion in April, and a decline in manufacturing output. Electricity, gas and steam generation, however, recovered in April.
Compared to the previous month on a seasonally- and calendar-adjusted basis, industrial output dropped 1.0% in April. The print contrasted the 2.2% expansion in March and marked the first decline in 2019. Regarding the sequential data, Muhammet Mercan, chief economist at ING Turkey, noted that the first drop in output in four months shows “the fragility of the recovery in economic activity. A prudent policy mix remains key to sustain the rebound in performance.” In addition, Mercan pointed out that roughly only a third of manufacturing-related sector posted gains in April, this suggests that “the rebound in early 2019 can be temporary.”