Turkey's CUR exceeds expectations

Turkey’s CUR exceeds expectations

Turkey's State Institute of Statistics (DIE) disclosed that the country's capacity utilization rate (CUR) in the manufacturing industry rose from 76.5% in April 2004 to 80.1% in April 2005, beating market expectations of 78.5%. CUR in the public sector, which fuelled the overall CUR increase, increased from 68.8% a year earlier to 80.7% in April. The rise in CUR of petroleum products and chemicals was a major factor in the public sector's CUR increase. On the other hand, CUR in the private sector fell from 81.6% to 79.9%. However, this retreat is not expected to be long-term. Domestic demand remained quiet in April, leaving exports and stocks to drive the bulk of production. However, domestic demand is expected to pick up towards the end of the second quarter of 2005. This, combined with robust exports, should fuel economic performance well into the third quarter. The downward trend in interest rates and the appreciation of the TRY will also support increased economic activity.