Turkey: Business conditions deteriorate in March
The ICI Manufacturing Purchasing Mangers’ Index (PMI), produced by S&P Global, fell to 49.4 in March from 50.4 in February. This marked the first time in 10 months that the index dropped below the neutral 50-threshold which separates deteriorating from improving business conditions compared to the prior month.
The headline drop came amid the fallout from Russia’s invasion of Ukraine, exacerbating headwinds already faced by the sector, as demand, prices and supply chains all felt the impact. The war led to subdued customer demand, with the spiraling prices discouraging clients. Both domestic and foreign new orders were dented by the war and, consequently, weighed on output. Furthermore, job creation slowed to the weakest level in nearly two years. Meanwhile, input costs rose on the back of the war as well, with the military conflict leading commodity to prices spike. Continued currency weakness also impacted cost burdens. That said, input cost inflation eased to a five-month low. On the other hand, output price inflation accelerated.