Throughout May, TRY experienced a depreciation of more than 10%. We will see how this affects the real exchange rate this afternoon. The real effective exchange rate, which fell to its lowest level ever, 47.7, in December, recovered slightly over the first three months of the year and rose to 57.0 in March. This data shows that the TRY is approximately 40% less valuable than the currencies of our trading partners, based on inflation differences between countries.
The construction cost index for April will be announced this week. In March, the index rose above 500, doubling compared to last year. Construction costs have increased by fivefold since 2015. The main reason for the increase in costs is the increase in exchange rates. In addition, the increase in raw material prices on a global basis also has an effect. However, the depreciation of the TRY has a much greater impact than the global price increase.
Apart from the economic data, the Cabinet convenes with President Recep Tayyip Erdogan today. Among the main agenda items for the meeting will be internal and external security issues, economic developments and the 3,600 additional indicators.
The Parliament will continue to discuss the legislative proposal for amendment of the Attorney’s act and the Environment Law, which includes regulations for “sea snot” and development, and a legislative proposal on the amendment of a range of laws on Tuesday.
The parliament’s justice commission will convene under the presidency of AK Party Istanbul Deputy Abdullah Guler to discuss the Justice and Prosecutors Law and a legislative proposal for amendment of a range of laws on Tuesday. The commission is also expected to begin discussing the Press Law and the legislative proposal on the amendment of some laws on Thursday.
The parliament’s planning and budget commission will examine the legislative proposal on the law of the Istanbul Finance Center on Wednesday.
In the meantime, the State-owned Enterprises Commission will audit the accounts of BOTAS Petroleum Pipeline Corporation on Tuesday, Directorate General of Ilbank AS, Sumer Holding AS, and Dogusan Boru Sanayi ve Ticaret AS on Wednesday, the state-owned tea producing company CAYKUR and sugar manufacturer Turkseker on Thursday.
Moreover, political parties will organize group meetings in Parliament this week.
DAILY AGENDA
The Central Bank will release the Monthly Price Developments report for May (10.00 a.m.).
The Ministry of Industry and Technology will release productivity statistics for the first quarter (10.00 a.m.).
The Union of Chambers and Commodity Exchanges of Turkey (TOBB) will release industry capacity reports for May (10.00 a.m.).
The Cabinet will convene under the presidency of President Recep Tayyip Erdogan (2.00 p.m.).
The Central Bank will release the Real Effective Exchange Rate for May (2.30 p.m.).
The Treasury and Finance Ministry will reissue a 2-year (679 days) maturity semiannually fixed coupon bond.
IN OUR MAGAZINE THIS WEEK:
>> On the cover: The e-commerce company Trendyol is on our cover this week. The firm aims to sell ‘100% Made in Türkiye’ products to a global customer base via its first overseas office, which opened in Berlin last week. Trendyol Group President Caglayan Cetin puts the company’s target at USD 1bn in global sales by 2023. You can read the details on pages 8-9.
>> Professor Ilter Turan: Cultivating peaceful relations might be a much better option. P. 10.
>> Q&A: Erhan Usta, IYI Party Parliamentary Group Deputy Chairman. P. 11.
>> Our Chief Economist Gunduz Findikcioglu examines the ‘lessons from high inflation-high debt countries’ on pages 12-13.
>> Zeynep Gurcanli: The wheat problem, Montreux pressure. You can read the details on page 14.
