Turkey: GDP accelerates in Q1 on the back of stronger domestic demand
June 30, 2011
In the first quarter, GDP soared 11.0% over the same quarter last year. The figure represented an acceleration compared to the already robust 9.2% expansion recorded in Q4 and overshot market expectations, which had anticipated a less pronounced 9.7% rise. The robust expansion in the first quarter reflected strong private consumption, which rose 12.1% over the same period last year (Q4: +9.0% yoy), boosting domestic demand growth to 15.9% (Q4: +14.7% yoy). Investment remains strong, but decelerated from the 42.1% annual rise tallied in Q4 to 33.6% in Q1. Moreover, government consumption expanded 6.7% over Q1 2010 (Q4: +3.2% yoy). Meanwhile, the net contribution from the external side of the economy remained negative, as imports continued to outpace exports. Exports of goods and services expanded 7.7%, up from the 4.3% expansion in Q4. Imports accelerated further, adding 27.0% (Q4: +25.4% yoy). As a result, the net contribution from the external sector to overall growth improved somewhat from minus 5.6 percentage points in the fourth quarter to minus 5.5 percentage points in the first. A quarter-on-quarter analysis corroborates the notion of an accelerating economy, as GDP rose 1.4% over the previous quarter in seasonally and calendar-day adjusted terms. The result, however, came in below the 3.6% expansion tallied in Q4.