Turkey's industrial output grows at modest pace

Turkey’s industrial output grows at modest pace

The robust export performance that drove Turkey's industrial output by picking up the slack for sluggish domestic demand hit a plateau in June. While Turkey's industrial production index rose 0.3 percent month on month in June, from 132.7 to 133.2, data from Turkey's State Institute of Statistics warn of a cooling in the country's industrial production growth. Year-on-year figures show that industrial production grew 1.6 percent in June; May on the other hand saw growth of 2.1 percent. A major factor in the slowdown in the growth of industrial production was that manufacturing production growth remained 1.2 percent in June. Booming export performance had been driving production figures higher in the previous months as the domestic demand was cooling down. However, as the export figures approached $6 billion, the increase in production began losing steam. Economists expect industrial production growth to continue losing momentum in the coming months due to high oil prices and the regression in the exchange rate. After recording growth of 9.9 percent in 2004, industrial output is projected to grow only 5.0 percent in 2005.