In October, the industrial production (IP) index contracted by 1.6% MoM, and by 3.1% in YoY terms. TurkStat announced that the seasonally and WDadjusted IP index index declined by 0.9% in October following a 1.6% increase in September. This marks the continuation of a downward trend observed since February. Consequently, the industrial production index remains approximately 6.5% below its February level. Furthermore, it is worth noting that the YoY changes in industrial production stayed in negative territory for the fifth consecutive month.
Although certain sectors showed resilience, the weakness in industrial production was broadly based across sectors. Although certain sectors showed resilience, the weakness in industrial production was broadly based across industries. On a YoY basis, most of the key sectors experienced a contraction in October, while production increases were recorded in specific sectors such as apparel (11%), fabricated metal products (2.5%), chemical products (2.1%), and basic metals (3%). Looking at the January–October period, a weak overall performance prevails across sectors, although leading sectors like chemicals, basic metals, and electrical equipment stand out with positive divergence. During this period, in YoY terms, the food sector recorded a 2.9% increase, chemicals rose by 3.4%, basic metals by 5.9%, and electrical equipment by 3.4%. On the other hand, sectors that registered annual contractions include apparel (-.%), plastics and rubber (-4.7%), motor vehicles (-4.5%), textiles (-2.3%), non-metallic mineral products,
Early indicators, such as manufacturing PMI and electricity consumption signal limited recovery ahead. Although the manufacturing PMI has remained below the critical 50 threshold for the past eight months (in fact, excluding the February and March figures of 50.2 and 50.0, the manufacturing PMI has been below the 50 threshold since July 2023), it improved from 44.3 in September to 45.8 in October and further to 48.3 in November. Similarly, electricity consumption, which is highly correlated with industrial production, showed signs of revival with YoY increases in November and December. While the overall outlook for industrial production remains weak, these early indicators point to a potential recovery compared to previous months. The manufacturing PMI and electricity consumption indicators suggest that the YoY contraction in industrial production, which has persisted for the past five months, might shift into modestly positive territory in November.
Gedik Investment