Turkey: Manufacturing business conditions continue to improve in August
Operating conditions in Turkey’s manufacturing sector continued to improve markedly—albeit at a slightly softer pace—halfway through the third quarter and suggested that the economic recovery from the pandemic gained traction. In August, the Istanbul Chamber of Industry Turkey Purchasing Managers’ Index (PMI) eased from 56.9 in July to 54.3. Moreover, the headline figure remained notably above the neutral 50-threshold that separates expansion from contraction in business activity.
August’s reading reflected a softer increase in export orders and output. That said, the loosening of containment measures continued to support domestic new business. Improved demand dynamics and higher production, moreover, led to a third consecutive month of rising employment. Regarding prices, input costs continued to climb amid continued currency weakness. Output prices were consequently raised.
Andrew Harker, economics director at IHS Markit, commented that “the sector continued to make inroads into the output lost during the COVID-19 downturn”. However, Harker added that “less positive were signs of building inflationary pressures, with both input costs and output prices rising at the sharpest rates for just under two years”.