Turkey: Manufacturing operating conditions improve strongly in July
Operating conditions in the Turkish manufacturing sector continued to improve at the outset of the third quarter, with the Istanbul Chamber of Industry Turkey Purchasing Managers’ Index (PMI) rising from 53.9 in June to 56.9 in July, the highest print since February 2011.
The uptick in July came on the back of strong increases in output and new orders, leading to staff onboarding amid capacity pressures. The improvement in demand was reflective of a reopening of the economy and thus businesses, while foreign demand also recovered somewhat. Backlogs of work, meanwhile, accumulated due to stronger demand and capacity constraints. Consequently, inventories were depleted as firms used stocks of finished goods to meet demand. Regarding prices, input costs continued to rise strongly but these were in part passed on to customers.
Commenting on the data, Andrew Harker, economics director at IHS Markit, stated: “The PMI data at the start of the second half of the year provides optimism that the recovery from the COVID-19 downturn is solidifying. […] Growth […] will have to be sustained for a longer period for a full recovery to be secured.”