Turkish manufacturing continues to show post-earthquake recovery signs April PMI shows

Turkish manufacturing continues to show post-earthquake recovery signs April PMI shows
/ S&P Global.
By bne IntelIiNews May 2, 2023

Turkish manufacturing continued to show signs of recovery from February's earthquake catastrophe in April, with output, new orders and exports all expanding for the second month running, according to the Istanbul Chamber of Industry Türkiye Manufacturing Purchasing Managers’ Index (PMI).

The headline PMI posted 51.5 in April, up from 50.9 in March and above the 50.0 no-change mark for the fourth month running.

Firms expanded their purchasing activity, but employment was broadly unchanged as retirements linked to a new early retirement law limited the ability of companies to expand workforce numbers.

Meanwhile, input prices continued to rise sharply in April amid higher raw material costs and currency weakness, but the rate of inflation eased to the slowest in the year to date, with output prices rising at the softest rate since last August.

Commenting on the PMI survey data, Andrew Harker, economics director at S&P Global Market Intelligence, said: “The recovery in the Turkish manufacturing sector gathered momentum in April, with gains in new orders and output solidifying and prompting a renewed increase in purchasing activity.

“Firms would also have liked to see employment rise, but a number of retirements made achieving this something of a challenge.

"February's earthquake continued to impact the sector, most noticeably through the effect on supply chains and the ability of firms to secure the materials they needed. As such, backlogs of work started to build up following a sustained period of reduction."

Overall, the rate of improvement in the health of Turkey’s manufacturing sector was the most pronounced since December 2021, S&P Global noted.

Disruption from the earthquake disaster, however, meant that backlogs of work increased for the first time in 14 months. Lead times in obtaining materials lengthened for the fourth month running.

Delivery delays prevented a rise in stocks of purchases despite a first expansion in purchasing activity in almost a year-and-a-half as manufacturers responded to higher workloads, S&P added.