Turkey’s May current account deficit seen at $3.6bn

By bne IntelliNews July 7, 2015

The Turkish economy is expected to post a current account deficit of $3.6bn in May while the end-year deficit is seen at $36.5bn, according to a Reuters poll of economists.

The current account shortfall narrowed 31% y/y to $3.41bn in April, above the market consensus forecast of $3bn. The deficit fell by 13% y/y to $14.5bn in January-April, while the 12-month rolling current account deficit increased to $44.3bn in April from $45.8bn in March.

The deficit was $3.65bn in May 2014.

The government expects the current account deficit to be $46bn (or 5.4% of GDP) this year and $49.2bn (5.4% of GDP) next year.

Falling oil prices, if sustained, may have a positive effect on the country’s current account deficit. Turkey imports most of its energy needs. Turkey’s energy import bill was $17.3bn in January-May, a 24.3% decline from a year, according to the latest foreign trade data of the statistics office TUIK.

Turkey's Balance of Payments (January-April)
($ mn) 2014 2015 y/y
CURRENT ACCOUNT  (16,716)  (14,469) -13%
 Goods, Services and Primary Income  (16,999)  (14,744) -13%
 Goods and Services  (13,706)  (10,498) -23%
      foreign trade balance  (17,629)  (14,518) -18%
      exports  57,229  53,214 -7%
      imports  74,858  67,732 -10%
CAPITAL ACCOUNT  (21)  (2) -90%
FINANCIAL ACCOUNT  (10,445)  (7,495) -28%
 Net FDI  (3,776)  (2,621) -31%
      Net acquisition of financial assets  1,428  1,407 -1%
      Net incurrence of liabilities  5,204  4,028 -23%
 Net Portfolio Investment  (1,727)  832 -
      Net acquisition of financial assets  934  1,130 21%
      Net incurrence of liabilities  2,661  298 -89%
NET ERRORS AND OMISSIONS  6,292  6,976 11%
Source: tcmb
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