What matters this morning

The world stock exchange markets welcomed the month with sales, while Turkish assets started to adversely differentiate from other developing markets. MSCI Turkey, which was among the indices with highest yields with 15% in July and August, has started September with a 5% loss. TRY meanwhile has been among the developing countries’ currency units that depreciated against USD at most.

Positive surprises happen in the country’s main economic indicators such as growth, external balance, fiscal policy, while headline and core inflation give different signals. Headline inflation hits the ceiling due to increase in food and energy prices while core inflation, which excludes food and energy, shows a downward trend.

Naturally, the Central Bank, which tries to straighten deteriorated expectations and pricing habits, emphasizes on core inflation items. Market players read this as a possible interest rate cut by the bank, according to daily DUNYA columnist Serhat Gurleyen. Markets showed such a reaction with the impact of the fact that sales rose in global markets and foreign exchange (FX) rates, which has been indirectly calculated from the Medium-Term Economic Program, sharply increased.

Contrary to markets, Gurleyen expects the interest rate, which is quite above the inflation, to remain steady. Concerns and volatility in the markets will continue until September 23, when the bank’s Monetary Policy Committee convenes, according to the daily DUNYA columnist. The bank should give a strong message and this message shouldn’t be deteriorated with the voices to come from the political side so that the economy firmly enters the last quarter when the country is likely to face external shocks.

Looking at the money market this morning, USD/TRY dropped by 0.19% to 8.45, while EUR/TRY is traded at 9.97. Spot gold hovers around USD 1.789 per ounce and brent crude reaches USD 73.46 per barrel. 


Industrial production index increased by 8.7% in July, compared to the same month of the previous year, according to the Turkish Statistical Institute (TurkStat). The index decreased by 4.2% on a monthly basis.

Retail sales volume with constant prices surged by 12.3% in July, compared to the same month of the previous year, according to TurkStat. Retail turnover with current prices jumped 32.7% in the same period.

The total turnover index increased by 45.1% in in July, compared to the same month of the previous year, according to TurkStat. The index dropped by 1.9% on a monthly basis.

The current account balance posted a USD 683m deficit in July, according to the Central Bank. The current account deficit was expected to reach USD 570m in July.


>> On the cover: This week you can read an interview with Batu Aksoy, the second-generation leader of Aksoy Holding, which is a traditional energy and tourism focused company. Now Aksoy Holding is preparing to invest in a model project in Sariyer, says CEO Batu Aksoy, who believes Turkey’s most promising sector is high-quality health tourism. Handan Sema Ceylan, managing editor of daily DUNYA interviewed Aksoy on their new venture. You can read the details on pages 14-15.

>> Professor Ilter Turan: The end of the American century? P.10.

>> Q&A: Sinan Oncel, Chairman of the United Brands Association (BMD) and Terteks CEO. P. 11.

>> Danish delegation chaired by Turkey mission chief visits VestelCity. You can read the details in our Diplomacy section on page 12.

>> Startup: DgPays gets boost from Goldman Sachs and EBRD. P. 16.

>> Energy: Hybrid power plant investments and local equipment. P. 23.

>> Zeynep Gurcanli: Who would have thought it could happen? P. 24

>> Do not miss Time Out alternatives for the week!

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