Turkish industry is moving toward stabilization in May

The situation in Turkey’s manufacturing sector improved significantly in May. This is indicated by the Purchasing Managers’ Index (PMI) from the Istanbul Chamber of Industry and Commerce, which was published by S&P Global.

The PMI rose from 47.3 points in April to 49.8 points in May, reaching its highest level since March 2024. Although the figure remains just below the 50-point growth threshold, S&P Global notes that it signals a near-complete stabilization of business activity in the manufacturing sector.

Readings above 50 points indicate growth, while lower readings point to a decline in economic activity.

Export orders provide a boost

According to S&P Global, the Turkish manufacturing sector benefited primarily from stronger export demand in May. New export orders rose for the first time in 20 months, ending a long period of declining foreign orders.

“The Turkish manufacturing sector performed more positively in May as renewed export growth contributed to a slight increase in production,” explained Andrew Harker, Economics Director at S&P Global Market Intelligence.

Businesses’ purchasing activity also increased. According to S&P Global, many manufacturers built up their inventories as a precautionary measure to hedge against potential supply bottlenecks and uncertainties in international markets.

Cost and supply pressures remain high

Despite improved demand, companies continue to face significant cost pressures. The survey showed that input prices rose sharply again in May.

In addition, suppliers’ delivery times lengthened, indicating ongoing strains in international supply chains.

According to the surveyed companies, uncertainties in the economic environment and rising prices remain key factors dampening demand and investment willingness.

According to S&P Global, whether this positive trend continues will likely depend largely on whether, in addition to exports, overall demand also grows more strongly again in the coming months.