Turkish manufacturers suffered from continued muted demand conditions in June, leading to a third consecutive monthly fall in the Istanbul Chamber of Industry Türkiye Manufacturing Purchasing Managers’ Index (PMI), according to survey data released on July 1.

The headline PMI contracted to 47.9 in June, down from 48.4 in May. The no-change mark is set at 50.0. Though the easing of business conditions was modest, it was the most pronounced in 2024 so far, said survey publisher S&P Global.

Andrew Harker, economics director at S&P Global Market Intelligence, said: "The sustained period of muted demand is starting to be more keenly felt in the manufacturing labour market, with Turkish firms showing a reluctance to replace departing staff and thus scaling back employment to the largest degree since October 2022.

“Firms are benefiting from softer cost inflation, however, and were able to raise their output prices only modestly in June. This should hopefully help to provide a support to demand in the months ahead."

Firms increased their selling prices by the least extent in four-and-a-half years, said S&P.

It added: “Output moderated for the third month running and at a solid pace, albeit one that was slightly softer than in the previous month. The slowdown in new orders meanwhile was greater than that seen in May amid reports of weakness in both domestic and export markets. That said, the moderation in new business from abroad was less marked than for total new orders.”

Where purchasing costs increased, panellists contributing data to the PMI survey mentioned higher prices related to raw materials and sea transportation, plus currency weakness.

Delays due to sea transportation issues, particularly as a result of disruption in the Red Sea, caused a further lengthening of suppliers' delivery times, the PMI assessment also showed.