Turkish exports fell to their lowest July figure since 2010 as shipments to Russia slumped by half from a year earlier.
Sales abroad fell more than 16 percent to $11.2 billion last month, widening Turkey’s trade deficit to $7.03 billion, in line with the median estimate in a Bloomberg survey, which is its highest level since December.
Exports declined on an annual basis for the seventh month in a row as demand for Turkish goods in main markets fell. Shipments to Russia, Turkey’s second largest trade partner in 2014, dropped by 48 percent from July last year while exports to the European Union declined 14 percent.
A recovery in exports is unlikely amid weak global economic activity but falling oil prices will prevent the trade gap from widening further, said Deniz Cicek, an economist at Finansbank in Istanbul.
“I can’t be too optimistic about exports with sales to both Russia and the European Union staying so weak,” Cicek said by phone on Monday. “But I see a limited room for improvement in the trade deficit, mainly stemming from falling imports and energy prices.”
Turkey’s imports in July fell 8.7 percent to $18.2 billion from a year earlier, the state statistics office in Ankara said in a statement on its website Monday. Despite the annual expansion in foreign trade gap, the shortfall was 13 percent smaller year-to-date compared to the same period in 2014. Cicek estimated that the annual gap would fall to around $76 billion by the year end compared with $84.6 billion in 2014.
The lira strengthened after the report was published but trimmed some of those gains later. The currency was trading 0.1 percent higher at 2.9216 per dollar at 11:41 a.m. in Istanbul. The lira has fallen around 20 percent against the dollar this year, the third worst depreciation among emerging market currencies tracked by Bloomberg.