While the country is shaking with terror incidents from the east to west, and news of martyrs becomes more frequent, making other news seem insignificant, I need to confess that it's not quite easy to talk about the economy. On top of that, we shouldn't forget about the basic objectives of terrorism. The others are; creating fear and uncertainty, misdirecting the attention and manipulating the attitudes of the community in this way.
Just look at our condition since the elections. While going through a process for the government's formation, we are also being hurt by violence incidents. Thus, we are losing time; we are being directed to lose time. In a conjuncture, where the world economy and the “power” in relation to that is going through critical periods, we are literally being blocked.
However, before the elections, we used to discuss “How will our prosperity increase in the new period?” This was going to be the next step. It was going to be about how this story will be written. As for the present point we're at; we are being returned to old stories. We are being shaken by sledgehammers that are hitting on steady stability and a wall of trust. On top of that, in this chaos we still need to focus and follow the national and international economy. Because the economy is also busy with finding a direction while intertwined with political developments.
In this context, last Friday, interesting data, which attracted all the attention, had been announced. The Industrial Production Index climbed to the 131 level and thus, it saw the highest level, not just in 2015, but in the last couple of years. This development in June is amounting to the fact that the index succeeded in increasing around 7.4% per year. When it's purified from the calendar effect, it's 5.5%... Thus, in the sense of the development in the industry, we are witnessing the highest speed of the year.
Through the June data, our observation related with the performance shown by the industry and economy became clearer. Then, in the direction of today's news, let's try to understand our tempo in the period in question. When we examine the numbers, we can see that the Industrial Production Index, which recorded a 1.3% increase in the first quarter, has recorded a 3.9% increase in the second quarter of the year. When we look at how this development came about, we understand that along with the recovery in the intermediary goods, the acceleration in the consumer products was effective. On the other hand, even though it lost a small amount of acceleration compared to the first quarter, with an 8.5% yearly increase, the capital good manufacturing is presenting its strongest performance in this period.
While analyzing the data in a sectorial sense, we designate that the manufacturing industry played an effective role in IPI's (industrial production index) increase in the second period.
As a matter of fact, the sub-index, related with this sector that has a huge impact in our industry, increased its acceleration to 4.9% in the second quarter, while it was around 1.3% in the first period. At this point, we think about opening the Capacity Usage Rate, which is another indicator related with industry, folders again. Because in CUR's data, we've observed a recovery in the second quarter even though it was limited. Within this frame, we remember the fact that the CUR, which regressed 0.6% in the first quarter, is pursuing a stalemate in the second quarter. In the background of the slight recovery in capacity usage, the highlighted matters are the recovery of the intermediary goods and the increase in the investment products. As for the consumption, the decrease is continuing in the second quarter.
Thus, when we mix the data from IPI and CUR, we can say that we are encountering some differences in the sub levels. On top of that, it's clear that both indicators are giving signals related with an industrial resurrection in the second quarter.
On the other hand, if we are to look at the importation data, while examining the demand dynamics, we are witnessing a consolidation in both consumption and capital products - while its stronger in the second one. As a matter of fact, while the consumption and capital products presented a 1% and a -5.6% change in the first quarter respectively, this increased to 1.9% and 3.9% in the second quarter. At this point, let us make a quote from the foreign trading analysis we've mentioned in this column previously; the liveliness in importation is only witnessed in certain phases. Motor vehicles, air vehicles and parts are topping that list.
If we are to gather all these messages under the same roof; we can say that the economy continued to receive the consumption support and showed a slight recovery in investments during the second quarter. Thus, the contribution from the domestic demand seems to have taken on the responsibility of growth. As we've examined before; there is no contribution from the foreign demand in the second quarter also. If you are to ask me "How about after this?" - that is unknown. Because, if things go on like this, questions over our economy will start piling up in the already sensitive global environment. As a matter of fact, especially terror is increasing the uncertainty and fear levels gradually. In short, today our country and economy is being terrorized.
