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POLL-Turkish economy to return to form with 6.7% growth in Q1, 5.5% in 2021

Credit: REUTERS/CANSU ALKAYA

Turkey's economy should expand by 5.5% this year after 6.7% estimated growth in the first quarter, based on the median of a Reuters poll on Wednesday, returning to trend after pandemic lockdowns were careful to avoid key sectors.

By Ali Kucukgocmen

ISTANBUL, May 26 (Reuters) - Turkey's economy should expand by 5.5% this year after 6.7% estimated growth in the first quarter, based on the median of a Reuters poll on Wednesday, returning to trend after pandemic lockdowns were careful to avoid key sectors.

Forecasts from 13 economists ranged from 4.5% to 7% for the full-year, while the median estimate was up from 4.5% in a February poll. For the first quarter, forecasts from 14 economists ranged from 5% to 7.5%.

Turkey's economy grew just 1.8% last year and 0.9% in 2019, well down from an average of about 5% over the last two decades.

It was one of only a few globally to avoid a contraction in 2020 despite the pandemic, thanks largely to a near doubling of lending by state banks to face down the initial virus wave.

While Turkey imposed new coronavirus measures at the end of last year that hit some services, they did not impede manufacturing and other sectors and most were lifted in March.

Economic activity is expected to slow in the second quarter due to tighter financial conditions and a full lockdown imposed in the first half of May.

But gross domestic product (GDP) is expected to expand on an annual basis due to the sharp contraction last year, when initial coronavirus fallout led to a contraction of 10.3% in the second quarter.

Finance Minister Lutfi Elvan has predicted growth of 5.5% to 6% in the first quarter.

The Turkish Statistical Institute is expected to announce GDP data for the first quarter at 0700 GMT on May 31.

(Reporting by Ali Kucukgocmen; Editing by Jonathan Spicer)

((ali.kucukgocmen@thomsonreuters.com , @alikucukgocmen; +905319306206; Reuters Messaging: Reuters Messaging: ali.kucukgocmen.thomsonreuters.com@reuters.net))

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