The SAMEKS data of the Independent Industrialists and Businessmen Association (MÜSİAD) for August 2019 have been announced. According to the report, the seasonally and calendar adjusted SAMEKS Composite Index rose by 3.1 points compared to the previous month to 47.4

In August 2019, the seasonally and calendar adjusted SAMEKS Composite Index rose by 3.1 points compared to the previous month to 47.4.

The rise observed in the index was driven by the increase of the services index by 3.9 points to 47.5 compared to the previous month, while the industry index also posted a relative recovery by rising 1.8 points to 48.7.

In this period, input purchases continued to increase in both the services and the industry sectors, maintaining their course above the reference value of 50. While the weak course of new orders in the industry sector limited the increase in production, the recovery observed in the sector's employment sub-index draws attention.

Thus, the SAMEKS Composite Index, which maintained its course below the reference value of 50 in August as well, indicated that the stagnation in the real sector continued in this period; nevertheless, the increases observed in the sub-indices compared to the previous month present a positive outlook.

Industry Sector SAMEKS Index

In August 2019, the seasonally and calendar adjusted SAMEKS Industry Sector Index rose by 1.8 points compared to the previous month to 48.7.

Input purchases for the sector rose by 1.7 points compared to the previous month to 53.8 and maintained their positive outlook.

In the new orders sub-index, an increase of 0.2 points was observed compared to the previous month. Thus, the continued weak course of new orders kept adversely affecting production in the industry sector. Nevertheless, the production sub-index, which stood at 48.2 with an increase of 3.0 points compared to the previous month, rose to its highest level since June 2018.

Despite the increase in input purchases, the continued sluggish course of new orders caused the finished goods stock sub-index to rise by 9.3 points at once compared to the previous month to 53.6.

In this period, the rise of the sector's production to its highest level in the last 14 months was positively reflected in employment, and the employment sub-index, which recorded an increase of 6.3 points compared to the previous month, rose to 50.0.

Thus, the seasonally and calendar adjusted SAMEKS Industry Index, which stood at 48.7, indicates that the flat outlook for the sector continued in the third quarter of the year as well.

Services Sector SAMEKS Index

In August 2019, the seasonally and calendar adjusted SAMEKS Services Sector Index rose by 3.9 points compared to the previous month to 47.5.

The business volume sub-index, which stood at 42.7 with an increase of 4.0 points compared to the previous month, thus rose to its highest level in the last year.

In this period, input purchases increased by 3.4 points compared to the previous month to 55.6 and presented a positive picture for the outlook of the services sector in the coming period.

The suppliers' delivery time sub-index, which rose by 6.4 points at once compared to the previous month to 52.4, signals that there was a recovery in the real sector's supply of raw materials and intermediate goods in this period.

In parallel with the recovery observed across the sector, the employment sub-index increased by 5.0 points compared to the previous month, and the index thus rose to 48.2.

In the light of these developments, despite the increase observed compared to the previous month, the seasonally and calendar adjusted SAMEKS Services Sector Index maintained its course below the reference value of 50 in the August period as well.

COMMENTARY:

Although it has maintained its course below the reference value of 50 since the July 2018 period, the marked recovery in SAMEKS in the August 2019 period draws attention. In this period, the official data announced for the real sector also support the recovery in SAMEKS.

Accordingly, in this period, increases were recorded in the manufacturing industry capacity utilization rate and the real sector confidence index announced by the Central Bank of the Republic of Türkiye, as well as in the sectoral confidence indices announced by TÜİK. The continued increase in input purchases in both sectors indicates that firms' confidence in the Turkish economy persists and that the recovery in the index will continue in the coming period.