Turkey’s economic confidence index rose to 98.6 in March, from February’s 95.8 index value. Increase in the index; resulted from increases in consumer, real sector (manufacturing industry), services and retail trade sector confidence indices. In the March period, consumer confidence index increased to 86.7, real sector confidence index increased to 110.2, service sector confidence index to 105.5 and retail trade confidence index to 109.2. Construction sector confidence index decreased to 79.8. The interim revision made by the sectoral sub-confidence indices caused the economic confidence index data to be revised.
With the Covid-19 outbreak and the measures taken against the epidemic, the slowdown effects were also seen on a sectoral basis in certain parts of 2020. Quarantine measures implemented in the form of partial restrictions or reduced working days caused a slowdown in activity in many sectors. The gradual improvement that started with the transition to the normalization period in the economy shows the effect of recovery from the bottom in many sectors, except for the new Covid measures, which are also effective on a sectoral basis. The increasing tendency of economic activity also reflects positively on confidence indices; It also supports a recovery effect towards the pre-epidemic period.
Of course, it is necessary to mention some risks in terms of the existence of factors affecting the sectors in different coefficients in the cyclical sense. The most affected sector will be the service sector, as the increase in the number of cases brings stricter measures again. The service sector will have to feel the slowdown effect again, because Covid measures will again cause restaurants, cafes and restaurants to operate incompletely. We are likely to see the effect of turnover and employment loss in these sectors again. In the retail trade sector, the impact can be more reduced, as essential needs as well as private consumption are included. Because, in these groups, there may be an accumulation of demand according to certain periods. In the construction industry; It may still be the case of providing cheap financing with housing loan campaigns that can be arranged according to need in certain periods; However, the policy interest rate, which will remain in practice at a rate of 19% for a while after the CBRT adopts a tight monetary policy, will cause the sector to slow down due to the high cost of financing.
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