POLL-Turkish factory activity expected to grow 6.7% in June

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Reuters://realtime/verb=Open/url=cpurl://apps.cp./Apps/econ-polls?RIC=TRIP%3DECI poll

ISTANBUL, August 5 (Reuters)Turkey’s industrial output is expected to rise 6.7% a year in June, continuing a strong two-year run despite runaway inflation and a struggling currency, a Reuters poll showed on Friday.

Production has made a strong recovery since the initial wave of coronavirus in April 2020.

Economists expect the pace of growth in the index to slow in the coming months. A potential drop in external demand or supply chain disruption due to Russia’s invasion of Ukraine could also affect production.

The median estimate from the Reuters poll of six institutions showed a 6.7% year-on-year growth in the calendar-adjusted industrial production index in June.

Forecasts for the index, considered a preliminary indicator of economic growth, ranged between 5.5% and 9.9%.

Albaraka’s Turkish economist Lutfullah Bingol said the index’s growth could slow from July, but a possible improvement in chip shortages in the automotive sector could mitigate the slowdown in other sectors. during the rest of the year.

“We expect industrial production index growth to slow slightly in July. However, if the chip problem in the automotive sector is resolved, this could balance out the calm in other sectors for the rest of the year. the year,” Bingol said.

“For this reason and due to the very good course of tourism, we still expect year-end growth above 4%.”

Turkey’s economy grew by 11% last year, up sharply from the previous year. But a sharp sell-off in the pound in December upset corporate and household budgets and pushed up inflation via import prices.

The currency crisis and the resulting jump to 80% inflation, as well as the fallout from the war, are expected to hamper growth in 2022.

The Turkish Statistical Institute will announce industrial production figures for June at 07:00 GMT on August 12.

(Reporting by Ezgi Erkoyun and Ali Kucukgocmen Editing by Ece Toksabay)

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