In November, both industrial production and real retail sales dropped for the third consecutive month, by -6.5% and -6.3% y/y, respectively. Moreover, the Manufacturing PMI remained low at 44.2 in December and the Consumer Confidence Index remained very weak at 58.5 in January, well below the long-term average of 72 points. The data suggests that investment and consumer spending have extended their contractions from Q3 into Q4 2018 and will probably decline further in Q1 2019 (in y/y terms). Meanwhile, the tradable sector continues to rebalance. USD-denominated imports of goods and services plunged by -20% y/y in November as the markedly weaker TRY has caused a strong rise in import costs. In contrast, exports benefited from the more competitive currency and grew by +7% y/y. The monthly current account has been in surplus since August and the 12-month rolling deficit narrowed to -USD34bn in November from a peak of -USD58bn in May 2018.
