Turkey: Current account deficit shrinks in August
October 11, 2011
In August, the current account incurred a deficit of USD 4.0 billion, the smallest deficit since October 2010, as domestic demand continues to weaken. The result was down from the USD 5.3 billion deficit recorded in July but was broadly in line with market expectations. Despite the improvement in monthly figures, the current account deficit continued to widen over the last 12 months, reaching USD 75.2 billion in August (approximately 9.4% of GDP). Imports continue to gradually decelerate as Turkish authorities try to rebalance the economic expansion towards domestic sources. Imports rose 26.3% in USD terms over August 2010 (July: +29.9% year-on-year), while exports expanded a stronger 32.2% over the same period the previous year (July: +24.1% yoy). As a result, the trade deficit narrowed from USD 9.0 billion in July to USD 8.2 billion, the lowest level since February.