Turkey’s current account deficit expanded by 29% y/y to $2.53bn in February, the central bank announced on April 11. This corresponded with the market's expectation.
The current account deficit, a weak spot when it comes to the Turkish economy, stood at $32.6bn in 2016, compared to the previous year’s $32.1bn. The government’s forecast for 2017 is $32bn, or 4.2% of GDP.
Exports declined by 2% y/y to $12.7bn while imports were up 2% y/y to $15.2bn, leading to a foreign trade deficit of $2.27bn in the second month of 2017, a 28% y/y rise from a year earlier.
Tourism revenues, which traditionally help the country plug its large current account deficit, were down 12% y/y to $863mn, financing 34% of the current account shortfall in February.
On the financing side, net foreign direct investment (FDI) inflows dropped 5% y/y to $457mn, while net portfolio inflows declined by a sharper 67% y/y to $409mn in February. There was an inflow of $331mn into Turkish equities in the month while the domestic government debt securities market saw an inflow of $179mn. The central bank also reported an outflow of $84mn through net errors and omissions.
Following the release of the latest data, the Turkish lira was trading at 3.7258 per dollar, down 0.10% d/d. The main stock exchange index, the BIST-100, was down 0.31% to 90,958.
|Turkey's Balance of Payments|
|Goods, Services and Primary Income||-33,548||-34,415||3%||-4,665||-5,605||20%|
|Goods and Services||-23,906||-25,424||6%||-3,503||-4,497||28%|
|Foreign trade balance||-48,114||-40,843||-15%||-4,632||-5,614||21%|
|Net acquisition of financial assets||5,095||3,155||-38%||548||428||-22%|
|Net incurrence of liabilities||17,550||12,303||-30%||1,611||1,059||-34%|
|Net Portfolio Investment||15,719||-6,292||-||-70||-2,482||3446%|
|Net acquisition of financial assets||6,129||1,511||-75%||384||-474||-|
|Net incurrence of liabilities||-9,590||7,803||-||454||2,008||342%|
|Net errors and omissions||10,198||11,268||10%||1,233||-822||-|