Turkey posts narrowest current account deficit of 2020 in October

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Turkey reported a current account deficit of $273 million for October, the smallest gap this year.

The deficit compared with a surplus of $2.74 billion in October 2019, the central bank said on its website on Friday. The country had posted a shortfall of $2.56 billion in September alone and it has reported a deficit every month this year.

The 12-month rolling current account gap totalled $33.8 billion in October.

Turkey’s balance of payments has deteriorated this year after a government-engineered borrowing boom led to a surge in demand for imports and its sales of goods abroad suffered due to the outbreak of the COVID-19 virus.

The deficit for the month of October was wider than economists expected. A Reuters poll of 12 economists had forecast a gap of $62 million. A similar survey by the state-run Anadolu news agency had predicted a shortfall of $200 million.

The current account, excluding gold and energy, posted a surplus of $2.93 billion. That compared with a surplus of $6.53 billion in October last year, the central bank said.

Official reserves of foreign currency rose by $4.18 billion during October. They had dropped by $3.63 billion in September.

Portfolio investment recorded a net intflow of $2.9 billion in October, the central bank said.

Turkey registered its highest monthly current account deficit of 2020 during the first outbreak of COVID-19 in March, when it totalled $5.45 billion. The country has now re-introduced some lockdown measures on the population after a second wave of the virus hit last month.

(This story was corrected to show portfolio inflows not outflows in the eighth paragraph.)

Ahval

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