Turkey: Consumer confidence falls on concerns over income

ANKARA

Consumers were less confident about their economic future in May, according to a report from the Turkish Statistical Institute released on Thursday.

The consumer confidence index fell by 1.6 percent in May from the previous month. The index fell to 64.29 in May from 65.35 in April. 

The index remained close to its March reading of 64.4 - the lowest level since 2009. 

While household expectations for their finances were little changed, expectations for future income were also lower in May.

The probability of saving index – consumers' expectation of savings increases in the coming year – decreased by 11.6 percent to 19.79 in May from 22.37 in April. 

There was also higher concern about employment by consumers; the number of people unemployed expectation index decreased by 1.6 percent to 65.70 in May from 66.75 in April.

The general economic situation expectation index also declined by 0.7 percent to 85.50 in May from 86.12 in April.

"Currency volatility, a high rate of interest, and pre-election jitters all account for the decline," commented Atilla Yesilada, an economist with Global Source Partners in Istanbul.

"We estimate that consumer spending is declining as well, to about 2 percent from about 2.5 percent in the previous quarter." 

"These issues are ongoing, so we should not expect a recovery right through the elections and beyond," he said.