Current account deficit hits $3.08 bln in May, exceeding expectations

The current account deficit was 3.08 billion dollars in May, according to the Turkish Central Bank's balance of payments statistics, which is higher than was expected.

K. Murat Yıldız / Duvar English

Turkey’s current account deficit decreased by 919 million dollars in May 2021 compared to the same month the previous year, to 3.081 billion dollars, according to data from the Central Bank. As a result, the twelve-month current account deficit was recorded as 31.85 billion dollars.

The services balance item, which had a deficit of 170 million dollars in May of last year, had a net surplus of 939 million dollars in May of this year. The secondary income balance item, which had a net outflow of 38 million dollars, had a net inflow of 151 million dollars.

In April, the current account deficit was 1.71 billion dollars, but the 12-month deficit was 32.74 billion dollars. The market expectation regarding the current account balance was that the current account balance would have a deficit of 2.9 billion dollars in May.

In comparison to the same month the previous year, the foreign trade deficit in the balance of payments increased by 125 million dollars to 2.87 billion dollars. In May of the previous year, the current account, excluding gold and energy, had a deficit of 2.1 billion dollars, while it had a deficit of 774 million dollars this month.

Officials reserves increased

Banks and the General Government realized net repayments of 674 million dollars and 19 million dollars, respectively, while other sectors realized a net use of 3.57 billion dollars this month, official reserves increased by a net amount of 1.28 billion dollars.

Net outflows arising from the primary income balance increased by 254 million dollars compared to the same month the previous year and reached 1.3 billion dollars as net revenues from the travel item under the services balance amounted to 665 million dollars.

Net inflows from direct investments amounted to 304 million dollars while portfolio investments recorded a net inflow of 836 million dollars.

Non-residents made a net purchase of 99 million dollars in the stock market and 349 million dollars in the government domestic debt securities market.

Regarding bond issuances abroad, banks realized a net repayment of 718 million dollars and other sectors realized a net use of 796 million dollars as domestic deposits of foreign banks recorded a net increase of 933 million dollars, with 840 million dollars in foreign currency and 93 million dollars in Turkish liras.