Turkey’s economy is growing at a steady pace, with a 5.7% increase in GDP during the first quarter of the year. This growth is largely driven by domestic demand, according to official data released on Friday. A Reuters poll had predicted a 5.7% expansion for the first quarter, and expectations remain high for the rest of the year, with a predicted growth rate of 3.15%.
However, despite these positive signs, the central bank has been tightening monetary policy in response to soaring inflation. Since last June, it has raised its policy rate by a total of 4,150 basis points. Despite these efforts, inflation remains high and there are concerns about slowing global trade.
Despite these challenges, Turkey’s economy continues to show signs of stability and growth. Factors such as an annual minimum wage hike and households making purchases ahead of expected inflation have contributed to the rapid growth in the first quarter. The construction industry saw a value added increase of 11.1%, while information and communication saw a 5.5% increase in value added during this period. Resident households also contributed significantly with a 7.3% rise in final consumption expenditure during the same period. Exports increased by 4% while imports fell by 3.1%.
The central bank will continue to tighten monetary policy in order to keep inflation under control and maintain economic stability in the coming months
