Turkish consumer confidence declines 1.8% in February

Turkish consumer confidence declines 1.8% in February
By bne IntelliNews February 20, 2017

Turkey’s consumer confidence index declined by 1.8% m/m in February, after registering a 5.6% m/m increase in January, data from national statistics office TUIK showed on February 20.

Households’ general economic situation expectations weakened in the month with the corresponding sub-index declining by 0.3% m/m. Respondents expected unemployment to increase in the next 12 months, the TUIK survey showed. Turkey’s jobless rate hit 12.1% in November last year as economic growth lost steam.

Households’ financial situation expectations also worsened in February. The related sub-index was down 2.2%, after rising by 2.9% m/m in January.

Domestic demand is the backbone of economic growth. Households’ final consumption, which accounts for nearly 60% of Turkish GDP, declined by 3.2% y/y in the third quarter of 2016, when the economy contracted by 1.8% y/y, the first quarterly contraction in seven years.

In the face of weak economic activity, the government has announced a set of measures aimed at boosting consumer spending, such as tax cuts on white goods and certain housing projects.

The government forecasts that private consumption will increase 4.3% this year and 4.8% in 2018.

TUIK's Consumer Confidence Sub-Indices
  Dec-13 Dec-14 Dec-15 Sep Oct Nov Dec-16 Jan-17 Feb
Consumer Confidence Index 75.0 67.7 73.6 74.3 74.0 68.9 63.4 66.9 657.0
Financial Situation Expectation of Households 92.4 88.8 93.2 92.1 94.1 89.0 85.4 87.9 85.9
General Economic Situation Expectation 101.9 91.8 99.9 102.9 101.6 95.1 86.0 88.6 88.0
Number of People Unemployed Expectation 81.8 67.3 78.4 80.4 77.2 71.3 65.4 68.9 67.9
Probability of saving 23.8 23.0 22.8 21.7 23.3 20.3 16.7 22.4 21.0
Source: tuik

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