Economic confidence in Turkey rose to its highest level in more than five years this month, as a calmer political situation helps the economy to recover after a series of crises hit growth last year.
The Turkish Statistical Institute’s official economic confidence index rose to 106 in August, up from 103.4 the previous month.
The rise was driven by a brighter tone in the private sector – sub-indices for the real estate, services, retail and construction industries all improved. However, consumers are yet to be convinced of the improvements, with the consumer confidence index lagging behind at 71.1, down from 71.3 in July.
Still, the overall increase represents the latest in a series of encouraging recent economic data. Figures released on Friday showed tourism arrivals increased a massive 46.4 per cent in the year to July, as the industry – a vital source of foreign exchange and jobs in Turkey – bounces back after terror attacks and an attempted coup discouraged visitors last year.
Such improvements have allowed the lira to strengthen, helping to bring inflation back below 10 per cent. The currency hit an eight-month high against the dollar on Friday, benefiting from a wider rally in emerging-market assets as investors are drawn to the country’s high interest rates.