Turkey’s economy is forecasted to shrink by 11.8 percent in the second quarter when the corona virus measures were implemented and 1.9 percent in the whole of 2020. Estimates of contraction for the second quarter were 7.1 percent to 13.1 percent in a Reuters poll participated by 14 institutions.
Turkey’s economy grew 4.5 percent in the first quarter, when the effects and measures of the outbreak were felt limited. The growth was supported largely by falling loan interest rates, combined with the central bank’s interest rate cuts, and an increased supply of loans led by state-owned banks.
Seeking to limit the slowing effects of the epidemic on the economy, the central bank provided money to markets at lower cost than policy interest rates, went on bond purchases similar to the easing steps of global central banks.
Estimates for the whole of 2020 were between 1 percent and 3.8 percent contraction, the survey found. These forecasts suggest the economy could shrink year-on-year for the first time since 2009.
Sectors such as trade, aviation, tourism suffered serious losses due to travel restrictions and other isolation measures taken from mid-March to slow the outbreak.
Since June, when isolation measures began to be relaxed, improvements in leading indicators such as foreign trade, confidence indexes and capacity utilization rate indicate that the economy is recovering.
TurkStat will release its second quarter national income data at 10:00 on August 31st.
