Turkish Deficit worsens: - 32% => "Bust" Risk "soon" ?

[JohnsonE]

- "Trade data is showing the Turkish Trade Deficit widening sharply, with Imports rising (up to) 43%, (but) Exports (only) a meager 11.7%", "for the first quarter of 2011", ( i.e. with a - 31.3% Negative difference).

Thus, Turkey's "Deficit (is) soaring to a Record $10.1 Billions", pointed out  Frankfurt MarketWatch Experts, and events "pushed Turkey’s current-account Deficit to ...12% of GDP in the first quarter of this year", according to London Experts.

Last "Thursda"y, it was officially "announced that Turkey's trade Deficit.. in May (2011) was far beyond expectations : $10 Billion $" : "This is the Largest Monthly trade Deficit in series, and brought 12-month rolling trade Deficit to -92.3 Billion dollars from -87.2 billion in April," (Turkish) Finansbank (reportedly) said in a research note.

=> In consequence, " the Turkish Economy Risks ...entering a Harsh Downturn later this Year", USA's Nasdaq Experts conclude, warning for a "rising potential for Bust". (Comp. Eurofora's recent publication after Turkish Elections).

"The growing Deficit in the nation's Current Account could force the (Turkish Central) bank to Hike Rates in the near future to Dampen ...domestic demand that could eventually cause a Bust" in Turkey's Economy, Nasdaq Experts explained.

Because of all this, added also to "Inflationary pressures", and to the fact that, recently, "the Turkish Lira Weakened versus (both) the Dollar ...and the €uro",  "the Turkish central Bank will find itself under increasing Pressure to contain the current account Deficit, making (big) Rate Hikes now look inevitable", Frankfurt's experts concluded.

"In seasonally adjusted terms, GDP grew by +1.4 % from the previous (2010) quarter, the Turkish Statistics Institute (TUIK) said", but this was driven just by the "Retail sector" and "Construction", with Annual Growth estimated by Market Watchers at about 6% (i.e. Lower than in the previous year), while, in general, "the Growth rate is expected to ...Lose pace "...the TEB bank (reportedly said in a research note.

But, "Turkey's exports to Europe Slowed Down" while "imports rose", "triggering an expansion in the current account Deficit" , whose "Gap" was "financed only with "Hot money" -- or capital in Short-term Speculative accounts".

> This adds to the reasons for which "Analysts have Warned that an External Shock, under such conditions, could abruptly Halt the inflow of Foreign Capital and Wreck Havoc in the Economy" of Turkey, mainstream Press Agencies noted.

Among others, in particular, "the Turkish Lira remains Vulnerable to Shifts in global Risk sentiment", TEB also warned now. 

"Only 10 years ago, Turkey underwent 2 financial Crises, and was Rescued (only thanks to EU Money from controversial and unpopular Negotiations, during 2001-2010, currently under Pressure), and "under a Loan and Restructuring programme overseen by the IMF", now chaired by French President Sarkozy and German Chancellor Merkel-backed Christine Lagarde from France.