Turkey’s manufacturing PMI edges up in August

Turkey’s manufacturing sector faced ongoing challenges in August, 2024, as subdued demand conditions persisted.

The Istanbul Chamber of Industry Turkey Manufacturing PMI rose slightly to 47.8 in August, up from 47.2 in July, but remained below the 50.0 threshold, indicating continued contraction in the sector. This marked the fourth consecutive month of declining business conditions.

New orders softened for the fourteenth month in a row, though the rate of decline eased to its slowest since May.

Despite this, firms scaled back production, employment, and purchasing activity, with output declining at the sharpest rate since November 2022.

Employment reductions continued for the seventh consecutive month, although the pace of job cuts was the slowest in three months.

Input costs continued to rise sharply, driven by currency weakness and higher raw material and logistics costs.

In response, manufacturers increased their selling prices at the fastest pace since April. The reduction in input inventories was the steepest in just over a year, as firms remained reluctant to hold stock amid weak demand.

Encouragingly, new export orders returned to growth for the first time since June 2023, offering a potential bright spot for the sector.

However, the overall demand environment remained challenging, keeping the sector under pressure.