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Elham AbolFateh

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Turkish fourth quarter GDP contracts 3 percent، worst performance in nine years

Monday 11/March/2019 - 11:58 AM
The Turkish economy
The Turkish economy contracted a sharper than expected
ISTANBUL (Reuters) - The Turkish economy contracted a sharper than expected 3.0 percent in the fourth quarter of 2018، its worse performance in nearly a decade، in the clearest sign yet that last year’s currency crisis is tipping it into recession.

Turkey، a major emerging market once seen as a star performer by international investors، achieved growth of more than 7 percent in 2017. But last year it was battered by a 30 percent slide in the value of the lira.

The year-on-year quarterly contraction compared with a median forecast of a 2.7 percent decline in a Reuters poll، and it was the worst performance since 2009. The lira eased slightly to 5.4545 against the dollar، from 5.45 before the official GDP data was published.

The economy grew 2.6 percent in 2018 as a whole، also the weakest performance since 2009، the Turkish Statistical Institute data showed. It compares with a forecast of 2.55 percent growth in the poll.

Fourth quarter GDP shrank a seasonally and calendar-adjusted 2.4 percent from the previous quarter. The data also showed the economy had expanded 1.8 percent year-on-year in the third quarter، revised from a previously reported 1.6 percent.

The construction sector - long a beneficiary of Turkey’s credit-fueled building boom - contracted 8.7 percent year-on-year in the fourth quarter، the data showed، coupled with a 6.4 percent contraction in industry sector.

Consumption expenditures of households decreased by around 9 percent in the last quarter، showing signs of slowdown in domestic demand.

edited by: rehab sayed

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