Turkey’s current account is expected to record a deficit of $4bn in May, down from $5.1bn in April, according to a Reuters poll yesterday that reflected the coronavirus impact on exports and tourism revenues.
For year end, the median poll response was for a deficit of $18bn, up from last month’s Reuters survey, with forecasts ranging from $6.5bn to $25bn.
Forecasts ranged between deficits of $3.2bn and $5bn on a 12-month basis for May’s current account balance, according to the poll of 12 institutions. The median was $4bn.
“Coronavirus outbreak caused a severe drop in export and tourism income. The fall in oil prices and energy imports compensated only a part of the losses in exports and tourism,” said Deniz Cicek, economist at QNB Finansbank who forecasted a year-end current account deficit of $25bn.
The country’s 12-month current account ended last year in surplus for the first time since 2001, though the monthly reading dipped back late last year as the economy recovered from a recession brought on by a 2018 currency crisis. Measures taken to curb the Covid-19 outbreak are expected to shrink the economy in 2020. The lira has fallen about 13% so far this year.
Turkey’s foreign trade deficit, the main component of the current account, surged 102.7% year on year in May to $3.42bn according to the general trade system, before measures against the outbreak were eased.
The central bank is expected to announce May current account data at 0700 GMT on July 13.
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