Manufacturing PMI also pointed to a contraction in September

Although the manufacturing Purchasing Managers’ Index (PMI) rose to 49.6 in September, indicating a slight improvement in the health of the manufacturing sector, it remained below 50 for the third consecutive month, indicating that the contraction continued.

The manufacturing PMI, compiled by S&P Global for the Istanbul Chamber of Industry (ISO), reached 49 in August. While September saw a milder slowdown in production and new orders, the pace of increases in input prices and output slowed markedly.

PMI values ​​below 50 indicate contraction, while values ​​above 50 indicate growth.

There was a contraction in production for the third consecutive month, but at a milder level compared to the previous month. While weak market conditions and a slowdown in new orders contributed to the slowdown in production, some companies saw an increase in demand throughout the month.

WEAKNESS IN ORDERS CONTINUED

The weakening of both new orders and new export orders continued in September, but this weakening occurred at a slower pace compared to August.

While the new orders subindex increased from 46.3 to 47.6, new export orders also increased from 47.2 to 47.3.

Although input costs continued to rise sharply at the end of the third quarter as TL weakness continued, they rose to the lowest level since May.

The input price subindex decreased from 72.8 to 64.7.

It was observed that jobs were created for the fifth consecutive month and the latest survey points to a slight increase in employment. Employment decreased from 50.2 to 50.1.

VEHICLE SECTOR PRODUCTION DECLINED FOR THE FIRST TIME IN SEVEN MONTHS

In terms of subsectors, production of land and sea vehicles, one of Turkey’s largest manufacturing sectors, contracted for the first time in seven months, while new orders also decreased in September after increasing in August.

In the main metal industry, one of the main manufacturing sectors, new orders began to increase in September, although at a moderate level, after three consecutive months of contraction.

Among the ten sectors followed, the most significant contraction in new orders was recorded in the textile sector. Based on new orders, there was the largest decrease in production in the textile industry in the last 10 months.

While production decreased in almost all sectors due to difficulties in receiving new orders, it only increased in the food sector.

‘SIGNS OF STABILITY HAVE BEEN SEEN’

Assessing the PMI data, S&P Global Economics Director Andrew Harker said: “In September, there were signs of stability in the Turkish manufacturing sector, with some companies reporting that demand remained positive throughout the month. “While business conditions remain challenging overall, recent data provides some hope that growth could return before the end of the year,” he said.

“One factor that helped businesses in September was the significant easing of inflationary pressures with the relative stability of the exchange rate,” Harker said. (REUTERS)