Turkey: Upside risk to 5% growth forecast

Get real time updates directly on you device, subscribe now.

Recent data showed that the Turkish economy grew 7.0% in annual terms during the first quarter of 2021 and 1.7% from the previous quarter. BBVA analysts Research note that the current strong momentum, ongoing credit growth and positive global outlook put upside risks to their cautious 5% growth forecast for 2021.

Key quotes:

“Domestic demand gave a solid contribution of 6.0pp, while the contribution of net exports turned positive (1.1pp) for the first time after 5 quarters. All sectors gave positive contributions in year-on-year terms, where the greatest support was from industry with 2.5pp, followed by the contribution from the commerce, transport and accommodation sectors of 1.4pp. “

“The slowdown is not yet clear so far due to the reopening and continued credit growth rates at moderate levels. Private consumption still accelerates while investment stabilizes as of May. “

“The current strong momentum, moderate but continued credit growth, and more positive global growth prospects reinforce risks to the upside of our cautious 2021 GDP growth forecast of 5%. On the downside, tighter financial conditions, downside risks to tourism revenue, and the end of the ban on layoffs and short-term job assignments in June add to uncertainty. However, a positive surprise is now more likely given the pending reaction of the economy with the reopening at the end of May ”.


Get real time updates directly on you device, subscribe now.

Leave A Reply

Your email address will not be published.