The ICI Manufacturing Purchasing Managers Index (PMI) fell from 49.2 in May to 48.1 in June. As a result, the index fell below the neutral threshold of 50, signaling a worse deterioration in business conditions compared to the previous month.
The overall drop was driven by weaker demand dynamics as output and new orders declined more sharply than in the previous month. Consequently, buying activity has decreased. Higher inflation due to more expensive raw materials and a weaker currency led to a further slowdown. Thus, output price inflation rose sharply, despite the largest decline since September 2021. Moreover, employment continued to grow.
Andrew Harker, director of economics at S&P Global, commented:
“Turkish manufacturers are currently facing challenging market conditions. […]. The coming months look set to continue to be challenging for firms.”
Participants in the FocusEconomics Consensus Forecast forecast that fixed investment will decline by 0.8% in 2022, up 2.0 percentage points from last month’s forecast, and rise by 2.3% in 2023.