20180717-法国巴黎银行-Turkey__Recovery_in_CA_deficit_becomes_visible_8页_379kb

Summary of the Document: Turkey - Recovery in Current Account Deficit

Core Content

This document provides an analysis of Turkey's current account deficit (CAD) and its implications for the economy and investor sentiment. It outlines the recent trends, underlying factors, and future outlook for the CAD, while also including legal and regulatory disclosures relevant to the distribution of the report.

Main Points

• Current Account Deficit Trends:
  The current account deficit in Turkey has widened significantly, reaching USD 57.6bn in May 2018 compared to USD 36.3bn in May 2017. This increase is attributed to high energy prices and a surge in gold imports.

• Impact of Energy and Gold Imports:
  Energy imports accounted for USD 35.8bn in May 2018, up from USD 27.2bn in May 2017. Gold imports rose to USD 14.3bn, compared to USD 3.4bn in May 2017. Excluding these two categories, the non-energy and non-gold CAD increased only slightly to USD 7.5bn in May 2018 from USD 5.6bn in May 2017.

• Positive Outlook for Recovery:
  The document suggests that the CAD may start to improve in the coming months due to:

  • Low domestic demand: Reduced consumption is expected to ease the deficit.
  • Strong exports: Continued export performance could help balance the account.
  • Tourism revenues: Increased tourism earnings are contributing to the improvement.
  • Decline in gold imports: High domestic interest rates are anticipated to reduce gold investment by households, leading to lower gold import volumes.

• Forecast for 2018:
  The CAD is expected to remain below the forecasted USD 60bn (7% of GDP) for 2018, thanks to the expected slowdown in economic activity and lower gold imports.

• Investor Sentiment and Currency Pressure:
  A recovery in the CAD is expected to positively impact investor sentiment and reduce currency pressure, which in turn could help stabilize inflation expectations.

Key Information

• The document is authored by Hakan Aklar, Chief Economist at Turk Ekonomi Bank A.S.
• The analysis is part of a broader report by BNP Paribas, which includes multiple charts for visual representation of CAD data.
• The report includes legal notices and disclosures regarding:
  • Non-independent research: The report is not independent research and is subject to potential conflicts of interest.
  • Marketing communication: It is intended for professional clients and eligible counterparties under MiFID II.
  • Confidentiality and usage restrictions: The document is confidential and may not be distributed without prior consent.
  • Regulatory compliance: The report is subject to various legal and regulatory requirements in different jurisdictions, including the UK, France, Germany, Belgium, Ireland, Italy, the Netherlands, Portugal, Spain, and Switzerland.

Charts Mentioned

• Chart 1: Annual current account deficit in USD billion.
• Chart 2: Current account deficit excluding gold, seasonally adjusted, over a 3-month average in USD billion.

These charts support the analysis by showing the trends in the CAD and its components.

Conclusion

While the current account deficit in Turkey remains a concern due to high energy prices and increased gold imports, the report indicates that a recovery is in sight. This is expected to be driven by lower domestic demand, strong exports, and tourism revenues, with gold imports likely to decline. The recovery in the CAD is anticipated to alleviate currency pressure and improve investor confidence. However, the report emphasizes that the information provided is for informational purposes only and not investment advice.