In the third quarter of 2024, Turkey’s economy expanded by 2.1% compared to last year. This is the slowest growth rate since the economy shrank in the second quarter of 2020, mainly because high interest rates put pressure on financial activities.
The second quarter’s growth figure was adjusted to 2.4%, and the latest growth is less than the expected 2.6%. Economic investment, known as gross capital formation, fell by 0.8%. This is the first drop in two years, contrasting with a 0.8% increase in the previous quarter. Government spending decreased by 0.9%, the biggest decline since early 2021, following a 0.4% reduction in the second quarter.
Exports grew slower, and imports fell sharply by 9.6%, more than the 5.8% decrease in the previous quarter. On a brighter note, consumer spending increased by 3.1%, improving from a 1.5% rise in the last quarter.
The economy shrank by 0.2% compared to the prior quarter, matching the 0.2% decline recorded in the second quarter. This marks the first time since 2018 that Turkey’s economy has contracted for two quarters in a row.