Turkey: Manufacturing PMI sinks in August on currency volatility
The Purchasing Managers’ Index (PMI), produced by the Istanbul Chamber of Industry (ICI) and IHS Markit, fell sharply from 49.0 in July to 46.4 in August. As a result, the index remained below the crucial 50-point threshold that separates expansion from contraction in the manufacturing sector for the fifth consecutive month.
The decline in the index came on the back of lower output, new orders, and employment, which was attributed to weak demand conditions. In contrast, new exports orders rose, aided by the huge currency depreciation. However, the weak lira led both input and output costs to rise at a survey-record high pace.
Central Bank figures showed that the manufacturing sector’s capacity utilization rate picked up slightly from 77.1% in July to 77.8% in August.