Turkey's current account deficit shrinks in January

Turkey's current account deficit was $2 billion in January, marking a decrease of $2.9 billion compared to the same month in 2014, whereas it stood at $42.9 billion on annual basis, the Turkish Central Bank said in a statement on Wednesday.

The decrease in current account deficit of $2.9 billion for January is mainly due to the declining oil prices which cut the value of imports sharply. The bank attributed the decrease to a $2.6 billion drop in foreign trade deficit and a $277 million surplus in the services sector.

"A drop in the current account deficit can be explained by declining energy prices, such as oil and natural gas, and commodity prices, such as iron and rice," Emre Özsöz, economics professor at State University of New York said.

Özsöz said that the appreciation of the U.S. dollar worsens major emerging market currencies, such as the Turkish lira.

"The import price for Turkey goes up and the country buys less due to high prices," he said. "Turkish exports are expected to rise in the coming months due to the low value of the Turkish lira and the current account deficit might shrink further if oil prices remain unchanged."