Goldman Sachs has raised its 2023 current account deficit forecast for Turkey to 43 billion dollars. The institution highlighted the negative impact of gold imports on the current balance in its assessment.
Goldman Sachs has increased its 2023 current account deficit forecast for Turkey from 38 billion dollars to 43 billion dollars.
The institution’s report on the matter highlighted that the significant deterioration in Turkey’s balance of payments since June was largely due to a sharp increase in basic goods imports, as well as, to a lesser extent, gold imports. The report mentioned that the decline in Turkish Lira deposit interest rates likely led to an increase in gold imports in July, possibly as inflation momentum started to pick up. It also emphasized that importation was driven by expectations of future currency depreciation.
The report further stated, ‘On the other hand, merchandise exports have continued to be weak due to ongoing weakness in external demand, and we expect this trend to persist.’