Turkey: Current account swings to surplus in September
The current account posted a USD 1.9 billion surplus in September, improving from the USD 0.4 billion deficit booked in August (September 2022: USD 3.0 billion deficit). The reading was supported by robust tourism inflows. Meanwhile, the 12-month trailing current account deficit improved, coming in at USD 51.7 billion in September (August: USD 56.6 billion deficit).
The merchandise trade balance improved from the previous month, recording a USD 3.7 billion deficit in September (August 2023: USD 7.1 billion deficit). Merchandise exports declined 2.7% year-on-year in September, contrasting August’s 0.5% increase. Meanwhile, merchandise imports plunged 16.4% on an annual basis in September (August: -7.9% yoy).
Analysts at the EIU commented on the outlook:
“Policy tightening will help to reduce the current-account deficit from an estimated 4.6% of GDP in 2023 to about 3% in 2024 as a result of lower domestic demand. Easing global commodity prices should also curb the rise in import costs. Meanwhile, a still-strong tourism sector and a recovery in external demand will support trade and services exports.”