Turkey: Manufacturing PMI edges up again in November but remains deep in contractionary territory
December 3, 2018
The Purchasing Managers’ Index (PMI), produced by the Istanbul Chamber of Industry (ICI) and IHS Markit, increased from 44.3 in October to 44.7 in November. However, the index remained below the crucial 50-point threshold that separates expansion from contraction in the manufacturing sector for the eighth consecutive month.
The uptick in the index came on smaller contractions in output, new orders and employment, although the declines were still marked. Mercifully, input and output price inflation eased thanks to the stronger lira, which lessened the pressure on firms somewhat.
According to Andrew Harker, Associate Director at IHS Markit: “While the worst of the current slowdown may be over, business conditions remain challenging and there is still some way to go before a return to growth is signalled.”
In line with lower manufacturing output, Central Bank figures showed that the manufacturing sector’s capacity utilization rate declined from 75.4% in October to 74.1% in November, the weakest reading in over three years.
Author: Oliver Reynolds, Economist