Inflation continues to have a supply-based upward trend around the world and uncertainty over high inflation continues in Turkey following the Central Bank’s inflation presentation. The financial services company Info Yatirim estimates the consumer price index to increase monthly by 3.0% and the annual inflation to hit around 81.3% in July, according to Caglar Toros, Research Analyst at Info Yatirim.
Turkey’s benchmark stock index ended with gains yesterday to finish at an all-time high closing of 2,656.32 points. After starting the week at 2,605.80 points, Borsa Istanbul’s BIST 100 index earned 63.94 points, or 2.47%, from Friday’s close of 2,592.38 points. During the day, the index’s lowest value was 2,600.28, while its daily high was 2,656.76. The total market value of the BIST 100 was around TRY 2.1tr by market close, with a daily trading volume of TRY 35.6bn. The Federal Reserve’s interest rate hike of 75 basis points in line with expectations and its message that it would henceforth have a softer approach, combined with financial reports released by listed companies, have raised the risk appetite in equity markets, according to analysts. They said 2,540 points will be the support level and 2,670 points will be the resistance level for the BIST 100 index, in technical terms
The manufacturing industry continues to oppose the ‘stockpiling’ debate initiated by Central Bank Governor Sahap Kavcioglu. Business world representatives who spoke to daily DUNYA argued that holding inventory is natural to guarantee a supply in production. They also stated that the slowdown in domestic and foreign demand has paved the way for the stock bubble and manufacturers are faced with profitless sales. Representatives, who also emphasized the recent increasing loan costs, added that investing loans in stocks won’t comply with market realities in a period when finance is very expensive.
Turkey is set to kick off the biggest social housing project in republican history, according to President Recep Tayyip Erdogan. Speaking after the Cabinet meeting Erdogan said people will become homeowners by paying installments just as they pay rent. The housing project is expected to be constructed with a local and horizontal understanding of architecture.
DAILY AGENDA
The passenger car and light commercial vehicle (LCV) market grew by 9.1% to 52,206 units in July, compared to the same month last year, according to the Automotive Distributers’ Association (ODD).
Meanwhile…
>> The Istanbul Wage Earners Cost of Living Index (WECLI), which indicates the movement of retail prices in Istanbul, rose by 4.09% in July, compared to the previous month, according to the Istanbul Chamber of Commerce (ITO). The Wholesale Price Index, which reflects wholesale prices in the city, increased by 3.10% in the same period. The Istanbul WECLI jumped 99.1%, hitting a 24-year high, and the Wholesale Price Index soared 87.95 in July, year over year.
>> Some 365,424 new coronavirus cases and 157 deaths due to COVID-19 were reported between July 18 and July 24 by the Health Ministry.
>> The interest rate implemented for TRY commercial loans rose to 31.33% in the week ending on July 22, the highest level since November 2018, according to the Central Bank.
>> The external loan debt of the non-financial private sector fell by USD 904.1m from USD 98.16bn to USD 97.26bn in May, compared to December 2021, according to the Central Bank. The non-financial private sector’s short-term loan debt rose by USD 136.19m in the same period.
>> Book-building by the packaging company Barem Ambalaj will be organized on August 3-4 at an IPO (initial public offering) price of TRY 36.0.
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>> The surge in CCI differentiates from the hike in RPPI
Our Eco Analysis Columnist Alaattin Aktas addresses the reasons why the difference between the hike in the Construction Cost Index and the surge in the Residential Property Price Index has increased.
