Turkey’s industrial output growth was expected to slow sharply in March, reflecting the initial impact of the coronavirus outbreak on economic activity.
The country reported its first case of the coronavirus on March 11, prompting some manufacturers to cut production or shutter operations. The business environment remains severely depressed.
Calendar-adjusted industrial output was seen expanding by an annual 1.8 percent, according to the median estimate in a Reuters survey of eight institutions published on Tuesday. Production had increased by 7.5 percent in February and by 7.7 percent in January. The data will be published on Thursday.
Turkey has earmarked tens of billions of liras in loans for manufacturers under an emergency programme designed to combat the effects of the coronavirus on their businesses. The central bank has also continued to cut interest rates to boost demand for borrowing.
The COVID-19 outbreak is hitting exports hard. Sales abroad shrunk by an annual 18 percent to $13.4 billion in March, while imports continued to grow, according to official data published on April 30. Turkey relies on exports to keep the economy growing and an historically-high current account deficit in check.
A monthly survey of industrialists by Markit Economics and the Istanbul Chamber of Industry has already indicated a marked slump in activity. The purchasing managers’ index dropped to 48.1 in March from 52.4 in February. Any reading below 50 reflects a contraction in activity.