Turkish industrial output seen contracting 7.55 percent in January – Reuters poll

Turkey’s industrial output is expected to fall 7.55 percent year-on-year on a calendar-adjusted basis in January, a Reuters poll showed on Wednesday, in what would mark the fifth straight month of decline reflecting a slowing overall economy.

The Turkish economy contracted 3 percent in the fourth quarter of 2018, official data showed on Monday, as last year’s lira crisis and high interest rates weighed.

Economists expect the economy to contract in the first two quarters of this year before turning to growth again.

The industrial output index, a key signal of economic activity, contracted 9.8 percent year-on-year in December.

The median estimate in a Reuters poll of eight financial firms showed the index dropping 7.55 percent in January. Estimates ranged between 5 percent and 9.1 percent.

The lira lost nearly 30 percent of its value last year in a sell-off sparked by concerns over the independence of the central given President Tayyip Erdogan’s calls for lower borrowing costs, and over a diplomatic spat with Washington.

Turkey’s central bank hiked its policy rate to 24 percent in September to counter rising inflation and support the ailing currency. It hiked a total of a 11.25 percentage points in 2018.

Turkey’s statistics institute will announce industrial output data at 0700 GMT on March 14.

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