Turkey’s Sectoral Confidence Indices Drop Sharply in April

TÜİK Reports Broad-Based Decline in Business Confidence Across Key Sectors

The Turkish Statistical Institute (TÜİK) released its April 2025 sectoral confidence indices, revealing a marked decline across services, retail trade, and construction sectors, based on seasonally adjusted data.

Compared to March, the data shows:

• Service sector confidence fell by 4.3% to 109.5

• Retail trade confidence declined by 2.5% to 110.6

• Construction sector confidence dropped by 4.2% to 85.1

These figures indicate a growing sense of economic uncertainty, especially in forward-looking expectations and business activity levels.

Services Sector Confidence Falls Most Sharply

The services sector saw the steepest decline among the three, with the index falling from 114.4 in March to 109.5 in April. Breakdown of key indicators includes:

• Current business situation: 114.9 → 107.3 (-6.6%)

• Past 3-month demand: 115.2 → 107.2 (-6.9%)

• Future 3-month demand expectations: 113.2 → 114.1 (+0.8%)

Although forward demand expectations improved slightly, the drop in current indicators reflects weakening recent activity and increased caution among service providers.

Retail Confidence Dips Again as Sales Outlook Worsens

The retail trade confidence index dropped from 113.4 in March to 110.6 in April, continuing a downward trend. Key sub-indices include:

• Business volume (past 3 months): 126.4 → 123.2 (-2.6%)

• Stock levels: 93.4 → 91.2 (-2.4%)

• Sales expectations (next 3 months): 120.4 → 117.4 (-2.5%)

The decline across all retail indicators suggests rising concern over future consumer spending and inventory management challenges.

Construction Sector Suffers Severe Confidence Drop

The construction sector confidence index declined from 88.9 in March to 85.1 in April, posting the second-largest drop among all sectors.

• Current order books: 84.6 → 83.0 (-1.9%)

• Employee expectations (next 3 months): 93.2 → 87.2 (-6.4%)

The sharp fall in employment expectations suggests contractors are bracing for reduced activity ahead, amid high costs and persistent uncertainty.

Outlook: Persistent Caution Amid Inflation and Political Tensions

These figures come at a time when inflation expectations remain elevated, and recent political developments have increased economic uncertainty. The broad-based decline in confidence reflects a widening concern among Turkish businesses regarding the outlook for domestic demand and macroeconomic stability.