The Central Bank will release the current account (CA) data for January, today (March 12).
The markets are looking for a CA deficit of USD 5.2bn. The CA deficit stood at USD 5.81bn in January 2013 and if the CA shortfall figure comes in at USD 5.2bn as the markets expects this will point to a 10.5% y/y and 37.3% m/m decline. Turkey last year ran a CA deficit of USD 65bn (around 8% of its national income). In December 2013 alone, the CA shortfall was USD 8.3bn.
The CA deficit is expected to shrink this year as the economic growth slows and domestic demand weakens while trade deficit, the main driving force behind the CA shortfall, should be improving due to a weaker TRY and recovery in the EU, Turkey’s main trade partner. In January, Turkey’s foreign trade deficit fell 6.8% y/y to USD 6.8bn (market forecast: USD 7.3bn) as exports rose 8.6% y/y and imports increased only 2.6% y/y. The Turkish Exporters’ Assembly (TIM) reported that exports showed a 4.3% y/y increase in February.
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