Slight moderation in Turkish biz conditions in Jan: S&P Global Ratings

The headline Istanbul Chamber of Industry Turkiye manufacturing purchasing managers’ index (PMI) increased to 49.2 in January from 47.4 in December, the highest reading in four months and signalling only a slight moderation in business conditions at the start of the year.

A large increase in the minimum wage led to a spike in the rate of input cost inflation in January (the fastest since last August), with output prices rising at a faster pace in response.

Meanwhile, issues with shipping in the Red Sea contributed to a solid lengthening of suppliers' delivery times, the rating agency said in a release.

The softer moderation of operating conditions matched the picture for output, which slowed to the least extent in six months. According to respondents, demand remained fragile but showed some signs of improvement in January, it said.

The ongoing fragility of demand was highlighted by a further easing of new business, extending the current sequence of moderation to seven months.

New export orders also softened, albeit only slightly. Firms scaled back purchasing activity and inventory holdings in response to weaker new orders, but they kept staffing levels unchanged following a fractional increase in December.

An increase in the minimum wage was widely mentioned by panellists, while higher raw material costs and currency weakness also reportedly added to price pressures.

In turn, manufacturers raised their own selling prices at a marked pace, with the rate of inflation quickening to a five-month high.

Suppliers' delivery times lengthened in January, following a slight shortening in December.

Fibre2Fashion News Desk (DS)