Turkey’s economy topped forecasts to expand by 7.3% in the first quarter of 2022, official data showed Tuesday, driven by strong demand, manufacturing and exports.
The economy bounced back from the pandemic to grow 11% in 2021, its highest in a decade, after narrowly expanding in 2020.
It has continued its strong performance in the first quarter of this year, despite inflation soaring to 70% in April and a widening current account deficit due to the surge in global commodity prices.
Quarter-over-quarter, gross domestic product (GDP) expanded 1.2% on a seasonally and calendar-adjusted basis, data from the Turkish Statistical Institute (TurkStat) showed.
The demand and spending were in part driven by rising prices.
The economy was forecast to have expanded 7.1% in the first quarter with full-year growth seen at 3%, a Reuters poll estimated, as a rise in energy prices due to the war in Ukraine weighs on the current account, budget and inflation outlooks.
Turkey was one of the few countries to expand in 2020, due largely to cheap loans to counter the pandemic’s economic impact. The economy rebounded in 2021 as COVID-19 restrictions were largely lifted.
The Turkish lira traded flat at 16.3995 against the United States dollar following the release of the data. The currency lost some 20% against the greenback this year, and 44% last year.
Separate data showed that the trade deficit almost doubled in April, driven by a 135% jump in energy imports. In the January-April period, the trade deficit widened by 130% year-over-year.