UPDATE - Current account gap at 7.7B in December 2017 in Turkey

Turkish Central Bank says annual deficit rose to $47.1B in 2017

UPDATE WITH COMMENTS FROM ECONOMISTS, ADDITIONAL INFORMATION

By Tuba Sahin

ANKARA (AA) - Turkey ran a current account deficit of $7.7 billion in December 2017, according to the Turkish Central Bank on Wednesday.

Data showed that annual deficit reached $47.1 billion in 2017.

"This development in the current account is mainly attributable to $3.2 million increase in the goods deficit, recording net outflow of $7.4 million, as well as $231 million increase in primary income deficit to $1.2 million," it said.

The median of analysts' forecasts surveyed by Anadolu Agency’s Finance Desk on Friday was $7.3 billion for the month, while the year-end overall current account forecast stood at $46.7 billion.

Travel, a major item under services, recorded a net inflow of $780 million, increasing by $80 million compared with the same month of the previous year, the bank added.

Turkey's current account gap in December 2016 was $4.36 billion with a 12-month rolling deficit of $33.1 billion, according to the Turkish Central Bank's revised data.

Muammer Komurcuoglu, economist at IS Investment, told Anadolu Agency the rise in the 12-month rolling deficit -- nearly $14 billion -- mainly was driven by energy and gold imports.

"This widening is related to energy and gold imports, which added $8.9B and $11.8B deficit, respectively," Komurcuoglu said.

Highlighting that core deficit [excluding gold and energy] shrinked by $6.7B he said: "It is good news to see a narrowing in core deficit in a high-growth year,"

Komurcuoglu said strong external demand, especially from EU countries and recovery in tourism revenues would positively effect current account deficit to narrow in 2018.

"Putting all these, we expect a moderate narrowing in the year-end overall current account deficit to reach at $45B [5 of GDP] in 2018." he added.

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