In the second quarter of 2025, Turkey’s GDP grew by 4.8% year-on-year, surpassing both the market consensus of 4.1% and our forecast of 3.8%. This marks a notable acceleration compared to previous quarters, partially supported by a favourable base effect. The growth was primarily driven by robust private consumption and increased investment activity. As a result, GDP growth for the first half of the year reached 3.3%.
With the release of the latest data, TurkStat revised the GDP series as part of its harmonisation efforts with the European System of National Accounts, extending the historical data series back to 1995. Following these revisions, first-quarter GDP was adjusted upward from 2.0% to 2.3%, while full-year 2024 growth was revised from 3.2% to 3.3%.
After seasonal adjustments, GDP for the second quarter of this year corresponds to a quarter-on-quarter growth rate of 1.6% – the highest quarterly increase in the past two years. This unexpected momentum, despite tighter financial conditions following political developments in March, is attributed to a) a positive shift in investment contributions, and b) inventory accumulation, which exceeds drags from private consumption, government spending, and net exports.