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Turkey: Main Economic Developments - October 2022

IM Insights
By IM Insights
1 year ago
Turkey: Main Economic Developments - October 2022

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  1. MAIN ECONOMIC DEVELOPMENTS Research and Monetary Policy Department October 2022 Ankara
  2. Contents Inflation Developments p . 3-10 International Developments p.11-27 Labor Market Developments p.28-34 Balance of Payments Developments p.35-48 Public Finance Developments p.49-55 Financial Intermediation and Loans Developments p.56-71 Financial Markets Developments p.72-81 Economic Activity Developments p.82-98
  3. INFLATION DEVELOPMENTS
  4. CPI and Special CPI Indicators (Annual % Change) CPI B C 90 80 70 60 50 40 30 20 10 Source: TURKSTAT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 09.08 09.07 0 Last Observation: September 2022 4
  5. CPI and Subgroups (Annual % Change) Services Core Goods Food Energy 160 140 120 100 80 60 40 20 0 Source: TURKSTAT Food: Food and alcoholic beverages. Core goods: Goods excluding food, energy, alcoholic beverages , tobacco and gold. 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 09.08 09.07 -20 Last Observation: September 2022 5
  6. Services Inflation (Annual % Change) Other Services Communication Transport Restaurants and Hotels Rent 110 90 70 50 30 10 Source: TURKSTAT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 09.08 09.07 -10 Last Observation September 2022 6
  7. Inflation Trend Diffusion Index (Seasonally Adjusted, 3-Month Average) CPI B 0.9 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 Source: CBRT, TURKSTAT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 09.08 09.07 0.0 Last Observation: September 2022 Diffusion index is calculated as the ratio of the number of items with increasing prices minus the number of items with decreasing prices to total number of items within a given month. 7
  8. Contribution to Annual Inflation (% Points) Energy Services Core Goods Food Alcoholic Bev. Tobacco and Gold 95 85 75 65 55 45 35 25 15 5 Source: CBRT, TURKSTAT Food: Food and alcoholic beverages. Core goods: Goods excluding food, energy, alcoholic beverages , tobacco and gold. 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 -5 Last Observation: September 2022 8
  9. Domestic PPI (Annual % Change) Domestic PPI Manufacturing Industry Prices 170 150 130 110 90 70 50 30 10 Source: TURKSTAT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 09.08 09.07 -10 Last Observation: September 2022 9
  10. Inflation Expectations (Annual % Change) 24 Months 12 Months 45 40 35 30 25 20 15 10 Source: CBRT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 09.08 09.07 09.06 5 Last Observation: September 2022 10
  11. INTERNATIONAL DEVELOPMENTS
  12. Global Inflation (Annual % Change) Advanced Countries Developing Countries 12 10 8 6 4 2 0 Source: Bloomberg, CBRT 08.22 08.21 08.20 08.19 08.18 08.17 08.16 08.15 08.14 08.13 08.12 08.11 08.10 08.09 -2 Last Observation: August 2022 Advanced Countries: USA, Euro Area, Japan, UK, Canada, S.Korea, Switzerland, Sweden, Norway, Denmark, Israel. Developing Countries: China, Brazil, India, Mexico, Russia, Türkiye, Poland, Indonesia, S.Africa, Argentina, Thailand, Czechia, Colombia, Hungary, Romania, Philippines, Ukraine, Vietnam, Chile, Peru, Egypt, Morocco. 12
  13. Core Inflation (Annual % Change) Advanced Countries Developing Countries 10 9 8 7 6 5 4 3 2 1 Source: Bloomberg, CBRT, Datastream 08.22 08.21 08.20 08.19 08.18 08.17 08.16 08.15 08.14 08.13 08.12 08.11 08.10 08.09 0 Last Observation: August 2022 Advanced Countries: USA, Euro Area, Japan, UK, Canada, S.Korea, Switzerland, Sweden, Norway, Israel. Developing Countries: China, Brazil, Mexico, Russia, Türkiye, Poland, Indonesia, S.Africa, Thailand, Czechia, Colombia, Hungary, Romania, Chile, Peru. 13
  14. Global Growth (Annual % Change) Advanced Countries Developing Countries Developing Countries excluding China and India 15 12 9 6 3 0 -3 -6 -9 -12 123412341234123412341234123412341234123412341234123412341234 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Source: Bloomberg, CBRT 2018 2019 2020 2021 Last Observation: 2021 Q4 Advanced Countries: USA, Euro Area, Japan, UK, Canada, S.Korea, Switzerland, Sweden, Norway, Denmark, Israel. Developing Countries: China, Brazil, India, Mexico, Russia, Türkiye, Poland, Indonesia, S.Africa, Argentina, Thailand, Malaysia, Czechia, Colombia, Hungary, Romania, Philippines, Ukraine, Chile, Peru, Morocco. 14
  15. Global Policy Rates (%) Advanced Countries Developing Countries 12 10 8 6 4 2 Source: Bloomberg, CBRT 08.22 08.21 08.20 08.19 08.18 08.17 08.16 08.15 08.14 08.13 08.12 08.11 08.10 08.09 0 Last Observation: August 2022 Advanced Countries: USA, Euro Area, Japan, UK, Canada, S.Korea, Australia, Switzerland, Sweden, Norway, Denmark, Hong Kong, Israel, New Zealand. Developing Countries: Brazil, Mexico, Russia, Türkiye, Poland, Indonesia, S.Africa, Thailand, Czechia, Colombia, Hungary, Romania, Philippines. 15
  16. Markit Global PMI Indices Manufacturing Services 50 Source : IHS Markit 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 09.08 62 59 56 53 50 47 44 41 38 35 32 29 26 23 20 Last Observation: Sep 2022 16
  17. US House Prices (January 2005 = 100) (Seasonally Adjusted) Federal Housing Finance Agency Home Price Index S&P Case Shiller Home Price Index (USA nationwide) 200 180 160 140 120 100 Source: Bloomberg 03.22 03.21 03.20 03.19 03.18 03.17 03.16 03.15 03.14 03.13 03.12 03.11 03.10 03.09 80 Last Observation: March 2022 17
  18. PMI (Manufacturing) US Eurozone Japan China 50 66 62 58 54 50 46 42 38 34 Source: IHS Markit 09.22 03.22 09.21 03.21 09.20 03.20 09.19 03.19 09.18 30 Last Observation: Sep 2022 18
  19. Unemployment Rates (%) US Eurozone UK Japan 16 14 12 10 8 6 4 2 Source: Bloomberg 05.22 05.21 05.20 05.19 05.18 05.17 05.16 05.15 05.14 05.13 05.12 05.11 05.10 05.09 05.08 05.07 05.06 05.05 0 Last Observation: May 2022 19
  20. Commodity Prices S &P-GS Indices (January 2005 = 100) Headline Energy Industrial Metals Agriculture 400 350 300 250 200 150 100 50 Source : Bloomberg 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 09.08 0 Last Observation: September 30, 2022 20
  21. Commodity Prices S &P-GS Indices (Annual % Change) Headline Energy Industrial Metals Agriculture 280 240 200 160 120 80 40 0 -40 -80 Source : Bloomberg 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 09.08 -120 Last Observation: September 30, 2022 21
  22. Risk Appetite (VIX) (%) 90 75 60 45 30 15 Source: Bloomberg 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 0 Last Observation: September 29, 2022 22
  23. Spread (OIS Spread) (%) US Dollar Euro 1.8 1.6 1.4 1.2 1.0 0.8 0.6 0.4 0.2 0.0 Source: Bloomberg 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 -0.2 Last Observation: September 30, 2022 23
  24. GIIPS Countries : Yield Spread (over Bunds, %) Spain Portugal Italy Greece (right axis) Source: Bloomberg GIIPS: Greece, Italy, Portugal, Spain. 09.22 09.21 09.20 09.19 09.18 0 09.17 0 09.16 10 09.15 5 09.14 20 09.13 10 09.12 30 09.11 15 09.10 40 09.09 20 Last Observation: September 23, 2022 24
  25. GIIPS Countries : Unemployment (%) Portugal Ireland Spain Italy Greece 30 25 20 15 10 5 Source : Bloomberg GIIPS: Greece, Italy, Portugal, Spain. 08.22 08.21 08.20 08.19 08.18 08.17 08.16 08.15 08.14 08.13 08.12 08.11 08.10 08.09 08.08 08.07 0 Last Observation: August 2022 25
  26. Portfolio Flows All Developing Countries , Weekly Fund Flows (Billion US Dollars) Equities Bonds 16 12 8 4 0 -4 -8 -12 -16 -20 Source : EPFR 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 -24 Last Observation: September 7, 2022 26
  27. Portfolio Flows All Developing Countries , Weekly 52 Week Cumulative Fund Flows (Billion US Dollars) Bonds Equities 175 150 125 100 75 50 25 0 -25 -50 -75 Source : EPFR 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 -100 Last Observation: September 7, 2022 27
  28. LABOR MARKET DEVELOPMENTS
  29. Source : TURKSTAT 07.22 04.22 01.22 10.21 07.21 04.21 01.21 10.20 07.20 04.20 01.20 10.19 07.19 04.19 01.19 10.18 07.18 04.18 01.18 10.17 07.17 04.17 01.17 10.16 07.16 04.16 01.16 10.15 07.15 04.15 01.15 10.14 07.14 Unemployment Rate (Seasonally Adjusted, %) 15 14 13 12 11 10 9 Last Observation: July 2022 29
  30. Participation Rate (Seasonally Adjusted, %) 55 54 53 52 51 50 49 48 47 46 Source: TURKSTAT 07.22 01.22 07.21 01.21 07.20 01.20 07.19 01.19 07.18 01.18 07.17 01.17 07.16 01.16 07.15 45 Last Observation: July 2022 30
  31. Employment (Seasonally Adjusted, Thousand People) Non-farm Employment (Right Axis) Farm Employment Source: TURKSTAT 06.22 03.22 12.21 09.21 06.21 03.21 12.20 09.20 06.20 03.20 12.19 09.19 06.19 03.19 12.18 09.18 20000 06.18 4200 03.18 21000 12.17 4400 09.17 22000 06.17 4600 03.17 23000 12.16 4800 09.16 24000 06.16 5000 03.16 25000 12.15 5200 09.15 26000 06.15 5400 03.15 27000 12.14 5600 Last Observation: 2022 Q2 31
  32. Employment by Sectors (Seasonally Adjusted, Thousand People) Industrial (Right Axis) Construction 2400 7000 6800 2200 6600 6400 2000 6200 1800 6000 5800 1600 5600 5400 1400 5200 Source: TURKSTAT 06.22 03.22 12.21 09.21 06.21 03.21 12.20 09.20 06.20 03.20 12.19 09.19 06.19 03.19 12.18 09.18 06.18 03.18 12.17 09.17 06.17 03.17 12.16 09.16 06.16 03.16 12.15 09.15 06.15 03.15 5000 12.14 1200 Last Observation: 2022 Q2 32
  33. Employment by Sectors (Seasonally Adjusted, Thousand People) Services 17500 17000 16500 16000 15500 15000 14500 14000 13500 Source: TURKSTAT 06.22 03.22 12.21 09.21 06.21 03.21 12.20 09.20 06.20 03.20 12.19 09.19 06.19 03.19 12.18 09.18 06.18 03.18 12.17 09.17 06.17 03.17 12.16 09.16 06.16 03.16 12.15 09.15 06.15 03.15 12.14 13000 Last Observation: 2022 Q2 33
  34. BALANCE OF PAYMENTS DEVELOPMENTS
  35. Foreign Trade (Seasonally Adjusted, 3-Month Moving Average, Billion USD) Export Export (excluding gold) Import Import (excluding gold) Import (excluding gold and energy) 35 30 25 20 15 10 Source: TURKSTAT, CBRT. 08.22 08.21 08.20 08.19 08.18 08.17 08.16 08.15 08.14 08.13 08.12 08.11 08.10 08.09 08.08 5 Last Observation: August 2022 35
  36. Foreign Trade (12-month Cumulative, Billion USD) Export Export (excluding gold) Import Import (excluding gold) Import (excluding gold and energy) 360 320 280 240 200 160 120 Source: TURKSTAT, CBRT. 08.22 08.21 08.20 08.19 08.18 08.17 08.16 08.15 08.14 08.13 08.12 08.11 08.10 08.09 08.08 80 Last Observation: August 2022 36
  37. Real Import and Real Export (Index 2015=100, Seasonally Adjusted, 3-month Moving Average) Export Export (excluding gold) Import Import (excluding gold) Import (excluding gold and energy) 170 160 150 140 130 120 110 100 90 Source: CBRT, TURKSTAT 07.22 01.22 07.21 01.21 07.20 01.20 07.19 01.19 07.18 01.18 07.17 01.17 07.16 01.16 07.15 01.15 07.14 80 Last Observation: July 2022 37
  38. Real Import and Real Export (Index 2015=100, Seasonally Adjusted Quarterly) Export Import Import (excluding gold) Import (excluding gold and energy) Export (excluding gold) 180 160 140 120 100 80 60 Source: CBRT, TURKSTAT 07.22 07.21 07.20 07.19 07.18 07.17 07.16 07.15 07.14 07.13 07.12 07.11 07.10 07.09 07.08 07.07 40 Last Observation: July 2022 38
  39. Current Account Balance (Seasonally Adjusted, Billion USD) Current Account Current Account (excluding energy and gold) Current Account (excluding gold) 8 6 4 2 0 -2 -4 -6 -8 Source: CBRT 07.22 07.21 07.20 07.19 07.18 07.17 07.16 07.15 07.14 07.13 07.12 07.11 07.10 07.09 07.08 07.07 - 10 Last Observation: July 2022 39
  40. Current Account Balance (Seasonally Adjusted, 3-month Moving Average, Billion USD) Current Account Current Account (excluding energy and gold) Current Account (excluding gold) 6 4 2 0 -2 -4 -6 Source: CBRT 07.22 07.21 07.20 07.19 07.18 07.17 07.16 07.15 07.14 07.13 07.12 07.11 07.10 07.09 07.08 07.07 -8 Last Observation: July 2022 40
  41. Current Account Balance (12-month Cumulative, Billion USD) Current Account Current Account (excluding energy and gold) Current Account (excluding gold) 60 40 20 0 - 20 - 40 - 60 Source: CBRT 07.22 07.21 07.20 07.19 07.18 07.17 07.16 07.15 07.14 07.13 07.12 07.11 07.10 07.09 07.08 07.07 - 80 Last Observation: July 2022 41
  42. Current Account Balance (Excluding Gold, Billion USD) 12-month cumulative 3-month moving average (Seas. Adj., right axis) 30 3 20 2 10 1 0 0 Source: CBRT 07.22 -8 07.21 - 80 07.20 -7 07.19 - 70 07.18 -6 07.17 - 60 07.16 -5 07.15 - 50 07.14 -4 07.13 - 40 07.12 -3 07.11 - 30 07.10 -2 07.09 - 20 07.08 -1 07.07 - 10 Last Observation: July 2022 42
  43. Current Account Balance (Billion USD) 12-month cumulative 3-month moving average (Seas. Adj., right axis) 20 2 10 1 0 0 Source: CBRT 07.22 -8 07.21 - 80 07.20 -7 07.19 - 70 07.18 -6 07.17 - 60 07.16 -5 07.15 - 50 07.14 -4 07.13 - 40 07.12 -3 07.11 - 30 07.10 -2 07.09 - 20 07.08 -1 07.07 - 10 Last Observation: July 2022 43
  44. Current Account Balance (% of GDP) Current Account Current Account (excluding energy and gold) Current Account (excluding gold) 8 6 4 2 0 -2 -4 -6 -8 Source: CBRT 06.22 06.21 06.20 06.19 06.18 06.17 06.16 06.15 06.14 06.13 06.12 06.11 06.10 06.09 06.08 06.07 - 10 Last Observation: 2022 Q2 44
  45. Main Sources of External Finance * (3-month Cumulative, Billion USD) FDI and Long Term Portfolio and Short Term CAD 35 30 25 20 15 10 5 0 -5 - 10 Source: CBRT 07.22 07.21 07.20 07.19 07.18 07.17 07.16 07.15 07.14 07.13 07.12 07.11 - 15 Last Observation: July 2022 * Long term capital movements are sum of banking and real sectors’ long term net credit and bonds issued by banks and the Treasury. Short term capital movements are sum of banking and real sectors' short term net credit and deposits in banks. 45
  46. Main Sources of External Finance * (12-month Cumulative, Billion USD) FDI and Long Term Portfolio and Short Term CAD 100 80 60 40 20 0 - 20 Source: CBRT 07.22 07.21 07.20 07.19 07.18 07.17 07.16 07.15 07.14 07.13 07.12 07.11 - 40 Last Observation: July 2022 * Long term capital movements are sum of banking and real sectors’ long term net credit and bonds issued by banks and the Treasury. Short term capital movements are sum of banking and real sectors' short term net credit and deposits in banks. 46
  47. Real Exchange Rate CPI Based REER * (2003=100) REER Developing Countries Based REER Developed Countries Based REER 140 130 120 110 100 90 80 70 60 50 Source: CBRT * Real effective exchange rate. 08.22 08.21 08.20 08.19 08.18 08.17 08.16 08.15 08.14 08.13 08.12 08.11 08.10 08.09 08.08 40 Last Observation: August 2022 47
  48. PUBLIC FINANCE DEVELOPMENTS
  49. Contributions To Primary Expenditures (12-Month Cumulative, Contribution To Annual % Change* ) Compensation of Employees Good and Services Purchases Capital Expenditures Primary Expenditures Current Transfers 100 90 80 70 60 50 40 30 20 10 0 Source: Ministry of Treasury and Finance * Principal items have been selected. 08.22 02.22 08.21 02.21 08.20 02.20 08.19 02.19 08.18 02.18 08.17 02.17 08.16 02.16 08.15 02.15 08.14 02.14 08.13 02.13 08.12 02.12 08.11 02.11 08.10 02.10 08.09 -10 Observation Date: August 2022 49
  50. Contributions To Tax Revenues (12-Month Cumulative, Contribution To Annual % Change* ) Special Consumption Tax Domestic VAT VAT on Imports 90 71 52 33 14 Source: Ministry of Treasury and Finance * Principal items have been selected. 08.22 02.22 08.21 02.21 08.20 02.20 08.19 02.19 08.18 02.18 08.17 02.17 08.16 02.16 08.15 02.15 08.14 02.14 08.13 02.13 08.12 02.12 08.11 02.11 08.10 02.10 08.09 -5 Observation Date: August 2022 50
  51. 03 .07 06.07 09.07 12.07 03.08 06.08 09.08 12.08 03.09 06.09 09.09 12.09 03.10 06.10 09.10 12.10 03.11 06.11 09.11 12.11 03.12 06.12 09.12 12.12 03.13 06.13 09.13 12.13 03.14 06.14 09.14 12.14 03.15 06.15 09.15 12.15 03.16 06.16 09.16 12.16 03.17 06.17 09.17 12.17 03.18 06.18 09.18 12.18 03.19 06.19 09.19 12.19 03.20 06.20 09.20 12.20 03.21 06.21 09.21 12.21 03.22 06.22 2022* 2023** 2024** 2025** Central Government Budget Revenues and Expenditures (12-Month Cumulative, As Percent of GDP) Budget Revenues Source: Ministry of Treasury and Finance, Medium Term Program (2023-2025) * Medium Term Program (2023-2025) realization estimate. ** Medium Term Program (2023-2025) target. Primary Expenditures 23 20 17 14 Observation Date: 2022Q2 51
  52. 03 .07 06.07 09.07 12.07 03.08 06.08 09.08 12.08 03.09 06.09 09.09 12.09 03.10 06/10 09.10 12.10 03.11 06.11 09.11 12.11 03.12 06.12 09.12 12.12 03.13 06.13 09.13 12.13 03.14 06.14 09.14 12.14 03.15 06.15 09.15 12.15 03.16 06.16 09.16 12.16 03.17 06.17 09.17 12.17 03.18 06.18 09.18 12.18 03.19 06.19 09.19 12.19 03.20 06.20 09.20 12.20 03.21 06.21 09.21 12.21 03.22 06.22 2022* 2023** 2024** 2025** Central Government Budget Balance (12-Month Cumulative, As Percent of GDP) Budget Balance Source: Ministry of Treasury and Finance, Medium Term Program (2023-2025) * Medium Term Program (2023-2025) realization estimate. ** Medium Term Program (2023-2025) target. Primary Balance 6 3 0 -3 -6 Observation Date: 2022Q2 52
  53. 03 .07 06.07 09.07 12.07 03.08 06.08 09.08 12.08 03.09 06.09 09.09 12.09 03.10 06.10 09.10 12.10 03.11 06.11 09.11 12.11 03.12 06.12 09.12 12.12 03.13 06.13 09.13 12.13 03.14 06.14 09.14 12.14 03.15 06.15 09.15 12.15 03.16 06.16 09.16 12.16 03.17 06.17 09.17 12.17 03.18 06.18 09.18 12.18 03.19 06.19 09.19 12.19 03.20 06.20 09.20 12.20 03.21 06.21 09.21 12.21 03.22 06.22 2022* 2023** 2024** 2025** Program Defined Primary Budget Balance (12-Month Cumulative, As Percent of GDP) 4 Primary Budget Balance (Program Definition) Source: Ministry of Treasury and Finance, Medium Term Program (2023-2025) * Medium Term Program (2023-2025) realization estimate. ** Medium Term Program (2023-2025) target. 4 2 2 0 0 -2 -4 -2 Observation Date: 2022Q2 53
  54. 03 .07 06.07 09.07 12.07 03.08 06.08 09.08 12.08 03.09 06.09 09.09 12.09 03.10 06.10 09.10 12.10 03.11 06.11 09.11 12.11 03.12 06.12 09.12 12.12 03.13 06.13 09.13 12.13 03.14 06.14 09.14 12.14 03.15 06.15 09.15 12.15 03.16 06.16 09.16 12.16 03.17 06.17 09.17 12.17 03.18 06.18 09.18 12.18 03.19 06.19 09.19 12.19 03.20 06.20 09.20 12.20 03.21 06.21 09.21 12.21 03.22 06.22 2022* 2023** 2024** 2025** EU Defined Public Debt (As Percent of GDP) Public Debt Stock Source: Ministry of Treasury and Finance, Medium Term Program (2023-2025) * Medium Term Program (2023-2025) realization estimate. ** Medium Term Program (2023-2025) target. 50 40 30 20 10 0 Observation Date: 2022 Q2 54
  55. FINANCIAL INTERMEDIATION AND LOANS DEVELOPMENTS
  56. Total Loans * (Year on Year Change, %) Total Loan Growth Total Loan Growth (FX adjusted) 80 70 60 50 40 30 20 10 0 Source: CBRT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 -10 Last Observation: September 23, 2022 Due to exchange rate movements and changes in TRY- FX loan weights and the currency composition of FX loans, the exchange rate adjustment methodology was updated with the aim to form a more representative total loan growth indicator. The total FX-adjusted credit growth is calculated using the change in TL loans and the change in FX (in terms of currency basket) loans multiplied by the period average of the exchange rate basket. For the technical note on the exchange rate adjustment methodology, please see. * Total banking sector (including participation banks). Loans extended to banks excluded. NPLs excluded. 56
  57. Commercial and Consumer Loans * (Year on Year Change, %) Commercial Loans (FX Adjusted) Consumer Loans 70 60 50 40 30 20 10 0 Source: CBRT Last Observation: September 23, 2022 The total FX-adjusted credit growth is calculated using the change in TL loans and the change in FX (in terms of currency basket) loans multiplied by the period average of the exchange rate basket. For the technical note on the exchange rate adjustment methodology, please see. * Total banking sector (including participation banks). Loans extended to banks excluded. NPLs excluded. 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 -10 57
  58. Total Loans * (Adjusted for Exchange Rate, Annualized 13-Week Growth, %) Total Loans 60 50 40 30 20 10 0 -10 Source: CBRT Last Observation: September 23, 2022 The total FX-adjusted credit growth is calculated using the change in TL loans and the change in FX (in terms of currency basket) loans multiplied by the period average of the exchange rate basket. For the technical note on the exchange rate adjustment methodology, please * Total banking sector (including participation banks). Loans extended to banks excluded. NPLs excluded. 13 week growth rate of credit stock, adjusted for exchange rate, is annualized. 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 -20 58
  59. Commercial and Consumer Loans * (Adjusted for Exchange Rate, Annualized 13-Week Growth, %) Commercial Loans Consumer Loans 140 120 100 80 60 40 20 0 -20 Source: CBRT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 -40 Last Observation: September 23, 2022 The total FX-adjusted credit growth is calculated using the change in TL loans and the change in FX (in terms of currency basket) loans multiplied by the period average of the exchange rate basket. For the technical note on the exchange rate adjustment methodology, please see. * Total banking sector (including participation banks). Loans extended to banks excluded. NPLs excluded. For commercial loans 13 week growth rate of commercial credit stock which is adjusted for exchange rate and for consumer loans 13 week growth rate of nominal consumer credit stock is annualized. 59
  60. Consumer Loans * (Annualized 13-Week Growth, %) Housing Personal (right axis) Vehicle 720 210 600 180 150 480 120 360 90 240 60 120 30 0 0 Source: CBRT * Total banking sector (including participation banks). Loans extended to banks excluded. NPLs excluded. 13 week growth rate of credit stock is annualized. 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 -30 09.12 -120 Last Observation: September 23, 2022 60
  61. Total Loans * (Adjusted for Exchange Rate, Annualized 13-Week Growth, %) Total Loans (2021) Total Loans (2008-2020) Total Loans (2022) 60 50 40 30 20 10 0 -10 -20 Week 1 Source: CBRT Week 8 Week 15 Week 22 Week 29 Week 36 Week 43 Week 50 Last Observation: September 23, 2022 The total FX-adjusted credit growth is calculated using the change in TL loans and the change in FX (in terms of currency basket) loans multiplied by the period average of the exchange rate basket. For the technical note on the exchange rate adjustment methodology, please see. * Total banking sector (including participation banks). Loans extended to banks excluded. NPLs excluded. 13 week growth rate of credit stock, adjusted for exchange rate, is annualized. 61
  62. Consumer Loans * (Annualized 13-Week Growth, %) Consumer loans (2021) Consumer loans (2008- 2020) Consumer loans (2022) 60 40 20 0 -20 -40 Week 1 Week 8 Week 15 Week 22 Week 29 Week 36 Source: CBRT * Total banking sector (including participation banks). Loans extended to banks excluded. NPLs excluded. 13 week growth rate of credit stock is annualized. Week 43 Week 50 Last Observation: September 23, 2022 62
  63. Commercial Loans * (Adjusted for Exchange Rate, Annualized 13-Week Growth, %) Commercial loans (2021) Commercial loans (2008-2020) Commercial loans (2022) 70 60 50 40 30 20 10 0 -10 -20 Week 1 Source: CBRT Week 8 Week 15 Week 22 Week 29 Week 36 Week 43 Week 50 Last Observation: September 23, 2022 The total FX-adjusted credit growth is calculated using the change in TL loans and the change in FX (in terms of currency basket) loans multiplied by the period average of the exchange rate basket. For the technical note on the exchange rate adjustment methodology, please see. * Total banking sector (including participation banks). Loans extended to banks excluded. NPLs excluded. For commercial loans 13 week growth rate of credit stock, adjusted for exchange rate,is annualized. 63
  64. NonPerforming Loans (%) Total Loans Commercial Loans Consumer Loans 7 6 5 4 3 2 1 Source: CBRT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 0 Last Observation: September 23, 2022 64
  65. Bad Cheque Ratio (%) Bad Cheque Ratio (Number) Bad Cheque Ratio (Amount) 8 7 6 5 4 3 2 1 Source: CBRT 08.22 08.21 08.20 08.19 08.18 08.17 08.16 08.15 08.14 08.13 08.12 0 Last Observation: August 2022 65
  66. Loan Rates (Flow, Annualized, %, 4 Week-Average) Commercial Personal Housing Vehicle 43 38 33 28 23 18 13 Source: CBRT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 8 Last Observation: September 23, 2022 66
  67. Loan Rates (Flow, %, 4 Week-Average) Commercial Loan Rate Commercial Loan Rate - Deposit Rate Spread (Right Axis) 38 14 33 12 10 28 8 23 6 18 4 Source: CBRT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 0 09.14 8 09.13 2 09.12 13 Last Observation: September 23, 2022 67
  68. Loan Rates (Flow, %, 4 Week-Average) Commercial Loan Rate Commercial Loan Rate (Excluding Corporate Overdraft Account and Corporate Credit Cards) 40 35 30 25 20 15 10 5 Source: CBRT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 0 Last Observation: September 23, 2022 68
  69. TL Commercial Loan RateDeposit Rate Spread (Flow, %, 4 Week-Average) Commercial Loan Rate-Deposit Rate Spread Commercial Loan Rate (Excluding Corporate Overdraft Account and Corporate Credit Cards - Deposit Rate Spread 18 16 14 12 10 8 6 4 2 Source: CBRT 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 0 -2 Last Observation: September 23, 2022 69
  70. Indebtedness and Leverage Ratios of NonFinancial Companies Listed on BIST Liabilities and Equity to Total Assets ( % Share)1,2 TL Liabilities / Total Assets FX Liabilities / Total Assets Equity / Total Assets 32.85 35.38 31.78 Source: CBRT 1 2 Including data for 337 non-financial corporations listed on BIST. Non-financial companies using FX functional currency, financial institutions and conglomerates are excluded from this sample. Last Observation: March 2022 70
  71. FINANCIAL MARKETS DEVELOPMENTS
  72. Average Funding Cost of CBRT Average Funding Cost of CBRT CBRT Total Funding (Billion TL) CBRT Average Funding Rate (Right Axis, Percent) 700 30 600 25 500 20 400 15 300 10 200 Source: CBRT 09.22 12.21 03.21 06.20 09.19 12.18 0 03.18 0 06.17 5 09.16 100 Observation Date: September 30, 2022 72
  73. CBRT Rates and BIST Overnight Rates CBRT Rates and BIST Overnight Rates (%) Interest Rate Corridor CBRT Average Funding Cost (5 day MA) One Week Repo Rate BIST Overnight Repo Rates_Closing (5 day MA) LLW Lending Rate 28 24 20 16 12 8 4 Source: CBRT 09.22 12.21 03.21 06.20 09.19 12.18 03.18 06.17 09.16 0 Observation Date: September 30, 2022 73
  74. Turkish Lira and Emerging Market Currencies Turkish Lira and Emerging Market Currencies (01.11.2011=1, values vis-a-vis USD) Türkiye Average of Emerging Economies Türkiye/Emerging Countries Source: Bloomberg, CBRT 09.22 01.22 05.21 09.20 01.20 05.19 09.18 01.18 05.17 09.16 11.35 10.65 9.95 9.25 8.55 7.85 7.15 6.45 5.75 5.05 4.35 3.65 2.95 2.25 1.55 0.85 Observation Date: September 30, 2022 Emerging market currencies include Brazil, Chile, Colombia, Hungary, Malaysia, Mexico, Poland, Philippines, South Africa, Indonesia, Romania against USD. 74
  75. Implied FX Volatility Implied FX Volatility (1 month) 120 110 100 90 80 Türkiye Emerging Economies 70 60 50 40 30 20 10 Source: Bloomberg 09.22 12.21 03.21 06.20 09.19 12.18 03.18 06.17 09.16 0 Observation Date: September 30, 2022 Emerging market currencies include currencies of Brazil, Chile, Colombia, Hungary, Malaysia, Mexico, Poland, Philippines, South Africa, Indonesia, Romania, Russia and Türkiye against USD. 75
  76. Implied FX Volatility Implied FX Volatility (12 months) 70 60 50 Türkiye 40 Emerging Economies 30 20 10 Source: Bloomberg 09.22 12.21 03.21 06.20 09.19 12.18 03.18 06.17 09.16 0 Observation Date: September 30, 2022 Emerging market currencies include currencies of Brazil, Chile, Colombia, Hungary, Malaysia, Mexico, Poland, Philippines, South Africa, Indonesia, Romania, Russia and Türkiye against USD. 76
  77. Currency Basket and EMBI Currency Basket EMBI + Türkiye (right axis) 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 950 850 750 650 550 450 350 250 Source: Bloomberg, CBRT 09.22 12.21 03.21 06.20 09.19 12.18 03.18 06.17 150 09.16 Currency Basket and EMBI Observation Date: September 30, 2022 77
  78. EMBI Global EMBI Global EMBI Europe EMBI T ürkiye EMBI Latin America EMBI Asia 1200 1100 1000 900 800 700 600 500 400 300 200 Source: Bloomberg 09.22 12.21 03.21 06.20 09.19 12.18 03.18 06.17 09.16 100 Observation Date: September 30, 2022 78
  79. Relative EMBI Relative EMBI (03.01.2012=1) EMBI Europe EMBI Latin America EMBI Asia EMBI Türkiye 2.80 2.50 2.20 1.90 1.60 1.30 1.00 0.70 Source: Bloomberg 09.22 03.22 09.21 03.21 09.20 03.20 09.19 03.19 09.18 03.18 09.17 03.17 09.16 0.40 Observation Date: September 30, 2022 79
  80. Yields Across Maturities Yields Across Maturities (%) 0.5 year 1 year 2 year 4 year 10 year 28 24 20 16 12 8 Source: Bloomberg 09.22 03.22 09.21 03.21 09.20 03.20 09.19 03.19 09.18 03.18 09.17 03.17 09.16 4 Observation Date: September 30, 2022 80
  81. ECONOMIC ACTIVITY DEVELOPMENTS
  82. Source : TURKSTAT 06.22 12.21 06.21 12.20 06.20 12.19 06.19 12.18 06.18 12.17 06.17 12.16 06.16 12.15 06.15 12.14 06.14 12.13 06.13 12.12 06.12 12.11 06.11 12.10 06.10 Annual GDP Growth (% Change) 25 20 15 10 5 0 -5 -10 -15 Last Observation: 2022 Q2 82
  83. Source : TURKSTAT 06.22 12.21 06.21 12.20 06.20 12.19 06.19 12.18 06.18 12.17 06.17 12.16 06.16 12.15 06.15 12.14 06.14 12.13 06.13 12.12 06.12 12.11 06.11 12.10 06.10 GDP (Seasonally Adjusted, 2009=100) 220 200 180 160 140 120 100 80 60 Last Observation: 2022 Q2 83
  84. Final Domestic Demand and Imports (Seasonally Adjusted, 2009=100) Final Domestic Demand* Imports of Goods and Services 240 220 200 180 160 140 120 100 80 60 Source: CBRT, TURKSTAT * Final domestic demand approximately calculated by CBRT 06.22 12.21 06.21 12.20 06.20 12.19 06.19 12.18 06.18 12.17 06.17 12.16 06.16 12.15 06.15 12.14 06.14 12.13 06.13 12.12 06.12 12.11 06.11 12.10 06.10 40 Last Observation: 2022 Q2 84
  85. Imports and Exports (Seasonally Adjusted, 2009=100) Exports of Goods and Services Imports of Goods and Services 240 220 200 180 160 140 120 100 80 60 Source: TURKSTAT 06.22 12.21 06.21 12.20 06.20 12.19 06.19 12.18 06.18 12.17 06.17 12.16 06.16 12.15 06.15 12.14 06.14 12.13 06.13 12.12 06.12 12.11 06.11 12.10 06.10 40 Last Observation: 2022 Q2 85
  86. Source : TURKSTAT 06.22 12.21 06.21 12.20 06.20 12.19 06.19 12.18 06.18 12.17 06.17 12.16 06.16 12.15 06.15 12.14 06.14 12.13 06.13 12.12 06.12 12.11 06.11 12.10 06.10 Quarterly Growth of GDP (Seasonally Adjusted, %) 20 15 10 5 0 -5 -10 -15 Last Observation: 2022 Q2 86
  87. Industrial Production Index (Seasonally Adjusted, Quarterly Average, 2015=100) 170 150 130 110 90 70 Source: TURKSTAT 07.22 07.21 07.20 07.19 07.18 07.17 07.16 07.15 07.14 07.13 07.12 07.11 07.10 07.09 07.08 07.07 50 Last Observation: July 2022 87
  88. Import Quantity Index (Seasonally Adjusted, Quarterly Average, 2015=100) 130 120 110 100 90 80 Source: TURKSTAT 07.22 01.22 07.21 01.21 07.20 01.20 07.19 01.19 07.18 01.18 07.17 01.17 07.16 01.16 07.15 01.15 07.14 70 Last Observation: July 2022 88
  89. (Seasonally Adjusted, Quarterly Average, Production 2015=100, Imports 2015=100) Capital Goods Production (rhs) Capital Goods Imports 140 175 130 155 120 135 110 115 100 95 90 75 80 Source: TURKSTAT 07.22 01.22 07.21 01.21 07.20 01.20 07.19 01.19 07.18 01.18 07.17 01.17 07.16 35 01.16 60 07.15 55 01.15 70 07.14 Capital Goods Production and Imports Last Observation: for Production: July 2022 for Imports July 2022 89
  90. (Seasonally Adjusted, Quarterly Average, Production 2015=100, Imports 2015=100) Intermediate Goods Production (rhs) Intermediate Goods Imports 140 150 130 140 120 130 120 110 110 100 100 90 90 80 80 Source: TURKSTAT 07.22 01.22 07.21 01.21 07.20 01.20 07.19 01.19 07.18 01.18 07.17 50 01.17 50 07.16 60 01.16 60 07.15 70 01.15 70 07.14 Intermediate Goods Production and Imports Last Observation: for Production July 2022 for Imports July 2022 90
  91. (Seasonally Adjusted, Quarterly Average, Production 2015=100, Imports 2015=100) Durable Goods Production (rhs) Consumption Goods Imports Nondurable Goods Production (rhs) 160 140 130 140 120 120 110 100 100 90 80 80 70 60 60 Source: TURKSTAT 07.22 01.22 07.21 01.21 07.20 01.20 07.19 01.19 07.18 01.18 07.17 01.17 07.16 01.16 07.15 50 01.15 40 07.14 Consumption Goods Production and Imports Last Observation: for Production July 2022 for Imports July 2022 91
  92. Source : CBRT 09.22 03.22 09.21 03.21 09.20 03.20 09.19 03.19 09.18 03.18 09.17 03.17 09.16 03.16 09.15 03.15 09.14 03.14 09.13 03.13 09.12 03.12 09.11 03.11 09.10 03.10 09.09 Capacity Utilization Rate (Seasonally Adjusted, %) 85 80 75 70 65 60 Last Observation: September 2022 92
  93. Export and Domestic Orders Expectations Over the Next Three Months (Increase-Decrease, Seasonally Adjusted) Export Domestic 50 40 30 20 10 0 -10 -20 -30 -40 -50 Source: CBRT 09.22 03.22 09.21 03.21 09.20 03.20 09.19 03.19 09.18 03.18 09.17 03.17 09.16 03.16 09.15 03.15 09.14 03.14 09.13 03.13 09.12 03.12 09.11 03.11 09.10 03.10 09.09 -60 Last Observation: September 2022 93
  94. PMI (Seasonally Adjusted) 60 55 50 45 40 35 Source: IHS Markit 09.22 09.21 09.20 09.19 09.18 09.17 09.16 09.15 09.14 09.13 09.12 09.11 09.10 09.09 09.08 30 Last Observation: September 2022 94
  95. Source : CBRT 09.22 03.22 09.21 03.21 09.20 03.20 09.19 03.19 09.18 03.18 09.17 03.17 09.16 03.16 09.15 03.15 09.14 03.14 09.13 03.13 09.12 03.12 09.11 03.11 09.10 03.10 09.09 Real Sector Confidence Index (Seasonally Adjusted) 125 115 105 95 85 75 65 55 Last Observation: September 2022 95
  96. Investment Tendency * (Increase-Decrease, Seasonally Adjusted) 40 30 20 10 0 -10 -20 -30 -40 -50 Source: CBRT 09.22 03.22 09.21 03.21 09.20 03.20 09.19 03.19 09.18 03.18 09.17 03.17 09.16 03.16 09.15 03.15 09.14 03.14 09.13 03.13 09.12 03.12 09.11 03.11 09.10 03.10 09.09 -60 Last Observation: September 2022 * Question number 23 from Business Tendency Survey: Compared to the last 12 months, how do you expect your fixed investment expenditure to change over the next 12 months? 96
  97. (Seasonally Adjusted) TURKSTAT-CBRT (rhs) Bloomberg HT 110 100 100 95 90 90 85 80 80 70 75 60 70 Source: Bloomberg HT, TURKSTAT 09.22 03.22 09.21 03.21 09.20 03.20 09.19 03.19 09.18 03.18 09.17 03.17 09.16 60 03.16 40 09.15 65 03.15 50 09.14 Consumer Confidence Indices Last Observation: For TURKSTAT–CBRT September 2022 For Bloomberg HT September 2022 97
  98. MAIN ECONOMIC DEVELOPMENTS Research and Monetary Policy Department October 2022 Ankara