Istanbul Chamber of Industry Türkiye and İstanbul Manufacturing PMI October 2019 Reports Were Announced

  • 01.11.2019
  • News
PMI-ekim2019_eng-01

Istanbul Chamber of Industry Türkiye Manufacturing PMI (Purchasing Managers Index), the most reliable reference for the manufacturing industry’s performance that is the leading indicator of economic growth was recorded as 49,0 in October and thus indicated a slight speed loss in Turkish manufacturing industry. Despite of several weakness indicators in October, the firms continued to increase employment level. An increase one after another has been realized for the first time since 2018 in employment which has grown in the second month successively.

Istanbul Chamber of Industry Istanbul Manufacturing PMI realized above 50,5 which is the threshold value for the second month successively and increased to 53,6 in October. Improvement in Istanbul manufacturing sector realized in the swiftest rate observed since February 2018.

The results of the ICI Türkiye and Istanbul Manufacturing PMI (Purchasing Managers Index) surveys, the fastest and the most reliable reference for the manufacturing industry's performance that is the leading indicator of economic growth, were declared for the term October 2019.

Given that the any figure above the threshold of 50 is an indication of improvement in the industry, Istanbul Chamber of Industry Turkish Manufacturing PMI which was measured as 50,0 in September was measured as 49,0 in October and pointed out to a slight speed loss in Turkish manufacturing sector.

New orders recorded a slowdown in October and reversed the growth observed in September.

Survey participants stated that there has been recession in demands in both domestic market and export markets. Firms took action against the challenges in demand conditions by decreasing the manufacturing activities. Despite of several weakness indicators in October, the firms continued to increase employment level. Employment recorded growth for the second month successively and accordingly, increase has been observed in the number of employees successively for the first time since 2018. Based on the weakness in Turkish Lira and increase in electricity prices, input costs continued to increase. Despite, inflation of input prices was kept in a lower level respectively at the last quarter of the year. As a part of efforts to promote sales, this situation enabled the firms to decrease final product prices for the second month successively. Additionally, decrease in the prices lost speed compared to the September and recorded in a moderate level. While a slight slowdown was observed in purchasing activities in October, a decrease in both input and final product stocks were recorded.

Andrew Harker, Deputy Director of IHS Markit said that: “Increase tendency recently observed in PMI data slowed down in October and this situation pointed out that the challenging market conditions in Turkish manufacturing sector maintained their existence. On the other hand, the general situation recorded an obvious improvement since this time last year and the firms were observed to trust in economic appearance to continue their employment increase.”

Istanbul Manufacturing PMI increased to 53,6 in October

Istanbul Chamber of Industry Istanbul Manufacturing PMI recorded as 51,9 in September was realized above 50,0 which is the threshold value successively for the second month in October and pointed out that the activity conditions of the sector have been improving. While PMI increased to 53,6 in October, sectoral improvement realized in the swiftest rate observed since February 2018.

Based on the intensity of customer demand, new orders recorded increased in the third month successively in October. Obvious growth in new orders realized in the swiftest rate of the last 20 months. New export orders pointed out to a growth; however, increase speed was measured in a lower level compared to that in new orders. Increase in the new orders encouraged manufacturers to increase their employment level. Apart from being recorded in the swiftest speed since December 2011, the employment increase realized in one of the highest levels recorded since January 2006 when the survey was started. Increasing capacity supported a strong increase in manufacturing and the manufacturing recorded a growth for the third time in the last 4 months. Along with the increase in the manufacturing requirements, purchase activities of manufacturers showed an increase in a strong speed and in the second month successively. Input purchases were recorded horizontally in general and accordingly, they put an end to 20-month-decrease trend. Inflation of input costs recessed for the fifth month successively and realized in the lowest rate since January 2015 and decreased under the average of the series. Respective decrease in cost pressures provided opportunity for making discount on final product prices to support the sales of the firms and accordingly, the prices recorded a decrease for the second month successively.