Turkey economy grows 11.1 per cent in third quarter

ANKARA: Turkey’s economy grew by a strong 11.1 per cent in the third quarter of 2017 compared to the same period last year, official statistics showed on Monday, with the high reading driven by one-off effects as well as resilient output.

The figure was even well above the consensus market forecast, which had been for 10 per cent growth. The economy had grown by 5.3 per cent in the first quarter and 5.4 per cent year-on-year in the second, according to revised figures.

Growth was driven by construction and services as well as a strong rise in exports, official data published by the Turkish Statistics Institute (TUIK) showed.

Turkish President Recep Tayyip Erdogan said last month that “no one should be surprised” if Turkey’s end-of-year growth for 2017 was around 7.0 per cent.

Analysts said ahead of the data release the third quarter figure would be particularly strong as the comparative period in 2016 was especially weak due to the effects of the July 15 failed coup and a long religious holiday.

However underlying growth is still seen as strong, largely due to a boom in construction driven by high government spending and cheap credit.

The economy grew by 1.2 per cent in the third quarter from the second quarter on a seasonallyadjusted basis, the TUIK said.

QNB Finansbank Research said before the announcement that its end of year forecast was for 6.3 per cent GDP growth but added the risks on that estimate “are currently skewed to the upside”.

The figures are likely to be welcomed by the government but come with signs Turkish economic policymakers need to tread carefully.

Inflation in November hit its highest annual rate in 14 years at 12.98 percent. The Turkish lira has also taken a battering, losing 13.5 per cent of its value against the US dollar since September.

The lira hit a record low of 3.97 against the greenback last month but the currency has rallied slightly since. — AFP