Turkey’s industrial production increased by 7.6% year-over-year in January, data showed on Friday, rising for the 19th consecutive month.
The reading has come in less than a forecast of 9.7% and cooled from six- month high growth in December due to disruption in some utilities.
Year-over-year growth, however, has remained positive since coronavirus measures were eased in 2020.
Month-over-month, industrial production fell by 2.4% in January on a calendar and seasons adjusted base, said the Turkish Statistical Institute (TurkStat).
A contraction was expected due to power and natural gas cuts to industrial facilities resulting from a failure in Iran. Tens of thousands of factories were forced to curtail production.
“This effect at the end of January can be expected to reflect in the following months because of the difficulties in global energy supply and costs, says Enver Erkan, Chief Economist at Tera Yatırım.
The median estimate in the Reuters poll of seven esteemed institutions growth of 9.7% in January. Forecasts varied between 7.0% and 12.1%.
All sub-indices increased in the month, with mines and quarries growing the most, according to TurkStat in A declaration.
The mines and quarries index climbed 8.3% year-over-year while the manufacturing index went up by 7.7%.
Electricity, gas, steam and air the packaging supply index increased by 5.6% in the same period, the data showed.
On a monthly basis, an 11.2% jump in the mining and quarrying index was not enough to offset the decline, car manufacturing industry and electricity, gas, steam and air packaging supply indices decreased by 3.1% and 1.6%, respectively.
In April of 2020, production dropped more over 31% in the face of the first one vague of coronavirus. He has since made a strong recovery because subsequent measures largely bypassed the manufacturing sector and most of the remaining restrictions were lifted in July of last year.
Turkey economy bounced back back of the COVID-19 pandemic to grow by 11% last yearson highest rate in a decade. Gross domestic product (GDP) increased by 9.1% year-over-year in the fourth quarter.
But a depreciation in the turkish lira pushed up inflation via import prices. Inflation jumped to 54% in February, as the fallout from Russia invasion of Ukraine is also darken the outlook.
“In particular, we will follow the balances created by the Russian crisis in terms of the production speed and costs of industry,” Erkan said.
He noted that the leading indicators, in particular the Purchasing Managers Index (PMI) for the manufacturing sector reported that the positive trend in manufacturing continues, but said the growth momentum of January and February points to a slowdown.
“We believe that together with the negative impact of the russian crisis on cooling sidele export orders in foreigner demand will shift the production curve down. Therefore, before the first half of the year it is possible industrial production is contracting on an annual basis.
