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GDP growth in the third quarter came in at 2.1% on a year-on-year basis, below the market consensus (2.6%) and our call (2.4%), and driven by gross fixed capital formation. TurkStat, on the other hand, revised second-quarter GDP expansion down to 2.4% from 2.5%. Accordingly, nine-month GDP growth stood at 3.2%.On a seasonally adjusted basis, following TurkStat’s downward revision for the second quarter, the sequential growth in this period turned to negative -0.2% quarter-on-quarter. Third-quarter GDP, on the other hand, recorded a negative QoQ growth rate of -0.2%. This shows further weakness as Turkey is now in a technical recession. Its feeble sequential performance is attributable to government consumption turning negative as well as further weakness in private spending and a negative contribution from inventories.
Quarterly Growth (%, YoY)
Source: TurkStat, ING
When we look at the breakdown on expenditures in the third quarter and compare them with the same period of 2023:
In the sector breakdown, construction turned out to be the biggest contributor (0.5ppt), followed by agriculture (0.4ppt). Further deceleration in the services sector and declining contribution to the headline GDP in recent quarters also attracted attention.
Drivers of the growth (ppt contribution)
Source: TurkStat, INGMore By This Author:
