IMSAAD Construction Materials Industry Composite Index Declines
Forex - The Construction Materials Industry Composite Index results for October 2024, prepared by TÜRKİYE İMSAD, have been released.
According to the results of the Construction Materials Industry Composite Index for October 2024, the Composite Index decreased by 0.25 points compared to the previous month, falling to 66.89 points. Meanwhile, the Activity Index increased by 0.6 points from the previous month, rising to 141.7 points. The confidence level dropped by 0.45 points compared to September, declining to 29.58 points. The Expectations Index, which decreased by 0.5 points and fell to 53.1 points, has now shown a decline for nine consecutive months.
The October 2024 results of the Construction Materials Industry Composite Index, regularly published monthly by the Turkish Association of Construction Material Producers (TÜRKİYE İMSAD), indicate a limited contraction in the Composite Index. It was noted that domestic activities performed weakly during the high season, and the seasonal contributions were not reflected in the indices, with a greater slowdown felt in the domestic market. The report mentioned that stagnation in export markets persisted, and both confidence and expectations remained weak.
As a result of these developments, the Construction Materials Industry Composite Index recorded a decrease of 0.25 points in October compared to the previous month, settling at 66.89 points. This result marks a decline for three consecutive months following the initial increase seen in July after local elections. The report indicated that the effects of tightening policies were felt increasingly over time. It also emphasized a noticeable decline in production, investment, and particularly employment expectations for the upcoming three months.
The report states that the future trajectory of the Composite Index will largely be shaped by the effects of economic policies and developments in export markets, with a noted postponement of recovery in the indices.
Activity Index rises to 141.7 points
According to the report prepared by TÜRKİYE İMSAD, the activities that recovered in September continued this trend in October. While the effects of the tightening policy on the domestic market persisted, no changes were observed in stagnation within global markets. It was highlighted that the positive effects of seasonality had diminished, and as a result of all developments, the Activity Index recorded a limited increase in October.
Data shared in the report reveals that in October, the Activity Index increased by 0.6 points compared to the previous month, reaching a level of 141.7 points. However, it was noted that despite this increase, the Activity Index remained below the figures from October of the previous year.
In terms of domestic sales in October, the index showed a limited increase compared to the previous month, while no changes were recorded in export data.
The index data showed an increase in production and turnover, along with a rise in export sale prices. The report indicated that activities in the construction materials industry were determined by tightening policies, seasonality, and developments in export markets. Additionally, it emphasized that the slowdown in the domestic market would continue and that as winter approached, negative seasonal effects would emerge. The report noted that the anticipated recovery in export markets had been postponed, and it projected that the Activity Index would remain stagnant for the remainder of the year.
Confidence Index decreases by 0.45 points
According to the report, the stagnation in the domestic market and the resulting weakness in activities in October led to a continued negative impact on confidence. Furthermore, it was emphasized that tightening policies slowed down operations in the domestic market, and difficulties in accessing finance persisted. The positive contribution of seasonality also diminished in October. Consequently, the Confidence Index showed a limited decline in October, remaining fragile. The index data indicated that the confidence level decreased by 0.45 points in October, falling to 29.58 points.
The report noted that confidence levels regarding the Turkish economy remained weak. It highlighted a limited decrease in confidence levels within the construction sector and construction materials industry. Additionally, it was stated that confidence in domestic markets had shown a slight increase while confidence in export markets had exhibited a slight decline.
Production, investment, and employment expectations significantly decreased
The report stated that the Expectations Index, which showed a limited decline in October, marked its ninth consecutive month of decrease. It was expressed that the weakening of domestic orders had a limiting role on expectations, and that the factors of tightening policies and the postponement of recovery in export markets had negatively affected expectations. Furthermore, it was noted that expectations for production, investment, and employment had distinctly decreased over the last five months.
Due to these ongoing processes, the Expectations Index fell by 0.5 points in October compared to the previous month, settling at 53.1 points. According to the report, the positive contribution of seasonality was not reflected in the index data. Additionally, during the diverging processes of production, investment, and wage increase expectations, employment expectations also showed a significant decrease.
It was mentioned in the report that expectations regarding the Turkish economy did not change in October, emphasizing that maintaining the economic program supported expectations for the country’s economy.
The report indicated a limited decrease in domestic orders for the upcoming three months and also noted a decline in export orders. Moreover, it highlighted that decreases in expectations for production, investment, and particularly employment were expected to continue in the next three months.