Turkey’s trade deficit narrowed for an 11th consecutive month in September, as slowing growth hit demand for imports and gold exports continued to increase.
The gap declined to $6.8 billion from a record $10.5 billion for the same month a year earlier, the statistics office in Ankara said on its website today. It was expected at $6.2 billion, according to the median estimate of three economists surveyed by Bloomberg.
Imports fell 6.4 percent to $19.8 billion and exports rose 21 percent to $13 billion led by precious metal exports to the United Arab Emirates, which increased to $1.1 billion, a more than fourfold gain over last year.
The precious metals figure has distorted the underlying trade picture and the narrowing deficit should be “taken with a pinch of salt,” Piotr Matys, an emerging markets analyst at 4cast Ltd., said by e-mail.
While the central bank has eased monetary policy in the second half, Matys said that was unlikely to change import tends in the near future. “The central bank will not allow domestic demand to fuel import growth significantly as was the case in 2011.”
Turkey has diversified exports from crisis-hit Europe, its biggest market, toward the Middle East, Asia and Africa. Import growth has slowed as the central bank tightened monetary policy to curb consumer credit, which had contributed to a current account gap that surpassed 10 percent of economic output last year.
That deficit helped push the lira down by more than 18 percent in 2011. The currency has pared losses this year, adding about 5.3 percent. The lira was trading up 0.1 percent at 1.7942 at 1:17 p.m. The ISE National 100 Index continued its rally, rising by more than 1 percent to 72,460.48.
The narrowing trade deficit is more a sign of a weakening economy than booming exports says Atilla Yesilada, Turkey country adviser at New York-based Globalsource Partners Inc., in a telephone interview. “This is a recession in domestic demand,” he said.