Türkiye | Post-quake recovery in activity

Industrial production (IP) rapidly recovered in March increasing by 5.5% m/m (1.8% m/m cons.), mostly wiping out the impact from the earthquakes. Recent better than forecasted momentum and potential continuation of populist policies after elections put upside risk on our 2023 growth forecast of 3%.

Key points

• Key points:
• Quarterly IP growth decelerated to 0.4% in 1Q23 from 1.9% in 4Q22 but still signaled an improvement, backed by the continuation of strong consumption.
• On the sectorial side, the recovery in manufacturing sector production (6.1% m/m) was broad-based but mostly supported by the production of other transportation vehicles (51.6% m/m).
• Turnover index in real terms rose by only 0.3% q/q in 1Q23 (vs 3.6% in 4Q22) supported by the construction and trade sectors while the industrial sector contracted by 3%.
• Preliminary indicators signal that recovery in economic activity is likely to continue, while our big data indicators confirm that activity might strengthen further unless any negative impact materializes on economy due to political uncertainty.
• Our monthly GDP indicator nowcasts an annual growth of near 4% in 1Q, which accelerates further to above 5% in early May (with 23% of information).

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