Turkish factory activity continued its expansion in March with improvements in new orders and output although February’s massive earthquakes continued to impact the sector.
The Purchasing Managers’ Index (PMI) for manufacturing rose to 50.9 last month from 50.1 in February, staying above the 50-point line that separates expansion from contraction, the Istanbul Chamber of Industry and S&P Global said.
Manufacturing production increased, the panel said, adding that in some cases earthquake reconstruction efforts led to higher output.
New orders returned to growth for the first time in a year and a half, the survey showed, as business increased solidly over the month and export orders picking up pace.
Despite the increase in production requirements, employment dipped for the first time in five months, in part due to the earthquake but also as a result of the new early retirement law, the panel said.
Input costs and output prices rose sharply last month amid higher raw material costs, currency weakness and increased wages, it also said.
“Renewed output growth in the Turkish manufacturing sector was a welcome development in March following the marked impact of the earthquake in February,” said Andrew Harker, economics director at S&P Global Market Intelligence.
“Although some firms were still affected, the start of reconstruction efforts supported the overall return to growth. With new orders also up, we are hopefully seeing an end to the relatively soft conditions experienced by firms over the past year or so.”