By Ali Kucukgocmen
ISTANBUL, Oct 8 (Reuters) – Turkey’s current account is expected to record a deficit of $4.6 billion in August, when the trade deficit surged, a Reuters poll showed on Thursday, as a sharp downturn in tourism contributed to widening estimates for the year-end deficit.
In the poll of 12 economists, forecasts for August ranged between deficits of $1.5 billion and $4.9 billion.
Turkey’s foreign trade deficit, the main component of the current account, leapt 168.2% year-on-year in August to $6.278 billion under the general trade system, according to the Turkish Statistical Institute.
Exports fell 5.7% and imports jumped 20.4% compared with August 2019.
For the whole year, the median poll response of 10 economists was for a deficit of $33 billion, compared to $26.50 billion in last month’s survey, with forecasts ranging between $31 billion and $40.3 billion.
Turkey’s long history of current account deficits – which topped $52 billion in 2018 – are again worrying investors as the lira touches record lows and the central bank eats into its foreign exchange reserves.
Finance Minister Berat Albayrak said last month that Ankara expects a deficit of $24.4 billion, or 3.5% of GDP this year. He said that without the downturn in tourism and surging demand for gold, Turkey would have posted a surplus of $12.4 billion.
Turkey’s 12-month current account ended last year in surplus for the first time since 2001, though the monthly reading dipped back late last year as the economy recovered from a recession brought on by a 2018 currency crisis.
Measures taken to curb the COVID-19 outbreak are expected to shrink the economy in 2020. The lira has fallen 25% this year as worries grow over the central bank’s depleted forex reserves. Recent geopolitical concerns have exacerbated its decline.
The central bank