Economic confidence in Turkey worst in a decade

15.4% Plunge in economic confidence in Sept

istanbul — Confidence in Turkey’s economy fell by the most in a decade in September with a 15.4 per cent tumble, official data showed on Thursday, reinforcing concerns about a sharp slowdown as the once star emerging market combats a currency crisis.

In another sign of the economic headwinds, major carmaker Tofas said it will halt output at its Bursa plant in northwest Turkey for nine days in October due to a local market contraction, sending its shares 5 percent lower.

According to data from the Turkish Statistical Institute, the economic confidence index dropped to 71.0 points in September from 83.9 points a month earlier, marking its biggest drop since late 2008 and its lowest level since March 2009. The index indicates an optimistic economic outlook when above 100 and a pessimistic one when below 100.

QNB Finansbank economist Deniz Cicek said the slide was inevitable given previously revealed declines in consumer and manufacturing sector confidence in the wake of the drop in the value of the lira. “We expect this development, which will negatively affect consumption and investment spending, will accelerate the slowdown in domestic demand.”

The lira has plunged by 40 per cent this year on concerns about President Tayyip Erdogan’s influence over monetary policy and a rift with the US. —