Turkey’s current account deficit hits a 4-year high

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The Central Bank of the Republic of Turkey shared official data on the balance of payments today (March 11).

Turkey's current account balance registered a 7.1 billion USD deficit in January, widening by 5.3 billion USD year-on-year, according to the data.

The Central Bank has commented that it "stemmed from a significant rise in the goods trade deficit, which soared by 6.4 billion USD to reach 8.3 billion USD." According to the Central Bank data, the country's 12-month rolling deficit stood at 20.2 billion USD this January.

The gold- and energy-excluded current account posted a 1.5 billion surplus USD, up from a surplus of 1.3 billion USD in the same month of last year.

A group of 26 economists surveyed by the state-run Anadolu Agency (AA) this week projected the current account deficit would come in at 6.97 billion USD in January. The survey showed the end-2022 current account balance is forecast to see a deficit of 26.52 billion USD.

In December 2021, the current account had a deficit of 3.84 billion USD.

About balance of payments

The balance of payments of a country is the difference between the money flowing into the country in a particular period of time (e.g., a quarter or a year) and the outflow of money to the rest of the world. These financial transactions are made by individuals, firms and government bodies to compare receipts and payments arising out of trade of goods and services.

The balance of payments consists of two components: the current account and the capital account. The current account reflects a country's net income, while the capital account reflects the net change in ownership of national assets. (Source: Wikipedia). (HA/SD)