Turkish factory activity contracts again in April

People take a selfie with the skyline of Istanbul in the background, Turkey October 28, 2015. REUTERS/Stoyan Nenov

ISTANBUL, May 5 (Reuters) – Turkish manufacturing activity slowed down slightly more in April due to fragile demand, supply pressures and the impacts of the war in Ukraine, a survey showed on Thursday.

The Purchasing Managers’ Index (PMI) for manufacturing declined to 49.2 in April from 49.4 in March, said a panel from the Istanbul Chamber of Industry and S&P Global, moving further below the 50-point line that separates expansion from contraction.

Manufacturing firms reported difficulties in securing new business leading to scaling back of output, the survey showed, mainly due to Turkish lira weakness and the Ukraine war.

A combination of rising prices and the war resulted in a slowdown in new export orders during April, first time since January, it showed.

Input costs continued to increase markedly, according to the panel, which in turn reflected onto manufacturers’ output prices.

Suppliers’ delivery times lengthened amid difficulties securing raw materials contributing to slowdown of purchasing activity, it also said, while firms continued to hire more staff to expand their capacity.

“The business climate facing manufacturers in Turkey was challenging again in April as price pressures remained elevated and supply-chain disruption continued,” said Andrew Harker, economics director at S&P Global.

“That said, both cost pressures and supplier delays were at the least pronounced since September last year, providing some hope that conditions will become more conducive to growth as this quarter progresses.”

Reporting by Ezgi Erkoyun; Editing by Toby Chopra

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