The Turkish manufacturing sector's activity improved further in December as it contracted at the slowest rate in eight months, a top business survey showed on Thursday, indicating that the sector is nearing stabilization.
The Purchasing Managers' Index (PMI) rose to 49.1 last month from 48.3 in November, moving nearer to the 50.0 threshold denoting growth, the survey by the Istanbul Chamber of Industry (ISO) and S&P Global revealed.
The move toward stabilization in overall business conditions in the sector was consistent with the picture across a range of variables in the latest survey.
"December PMI data provided plenty of hope for the sector in 2025. While business conditions continued to moderate, the latest slowdown was only marginal as signs of improvement were seen in a range of variables across the survey," said Andrew Harker, Economics Director at S&P Global Market Intelligence.
The survey highlighted a softer moderation in production, which declined at the slowest pace in nine months, suggesting some improvement in demand. The rate of slowdown in new orders and purchasing eased, although demand remained subdued.
Despite the positive signs, employment in the manufacturing sector saw a renewed decline, reversing a rise in November, the survey showed.
Input costs increased at a marked pace due to higher raw material prices, but the rate of output price inflation slowed to its weakest in over five years as some firms offered discounts to boost sales.
"If this momentum can be built on at the start of 2025, we could see the sector return to growth. The prospects for the sector should be helped by a much more benign inflationary environment than has been the case in recent years," Harker said.
"Output prices rose only slightly in December and to the least extent in just over five years," he said.
