Turkey’s current account deficit grew by 89 percent in February from a year ago, widening the 12-month rolling deficit to $37.8 billion, or 5.3 percent of gross domestic product (GDP).
The deficit expanded to $2.61 billion in February from $1.38 billion in the same month of last year, exceeding economists’ forecasts, according to data published by the central bank on Monday.
Turkey was expected to report a current account deficit of $2.3 billion, the state-run Anadolu news agency said last week, citing an average estimate of 13 economists. Predictions ranged from $1.7 billion to $2.7 billion.
The current account gap grew to 5.1 percent of GDP last year after the government engineered a borrowing boom backed by the central bank that encouraged more imports.
Turkey must finance any shortfall in the deficit through revenue such as tourism income, foreign direct investment or portfolio inflows. The lira slumped against the dollar in 2020 partly because the country could not secure enough of such financing.
Financial data shows that lending by banks is continuing to expand in 2021, raising concerns among foreign investors that the deficit may remain under pressure as Turkey suffers from a lack of capital inflows and tourism revenue. COVID-19 cases in the country are at record levels, deterring European countries from allowing their citiziens to resume travel there.
The lira was trading down 0.6 percent at 8.2 per dollar in late morning local time in Istanbul, weaker than earlier in the day.
Turkey’s central bank had reported a current account deficit of $1.87 billion for January. The shortfall narrowed by 7.7 percent from the same month of 2020, it said.