The Turkish economy recorded solid growth in Q1, equal to 4.5% in annual terms and 1.7% on a quarterly basis. Nevertheless, underlying conditions point to a slowdown this year as domestic demand decelerates due to sharp tightening of monetary conditions in January combined with slower credit growth and high inflation.
As a result, the economy continues to rebalance towards exports, which rebounded by a solid 7.7% q/q in Q1 in contrast to imports which shrank by 2.4%. This development is welcome from the trade balance point view as it should lead to the current account deficit narrowing from 7.9% of GDP in 2013 to 3.3% in 2014.
Source : Cushman & Wakefield