THBB Publishes "Ready-Mixed Concrete Index" Report for June 2019

Turkey's Ready-Mixed Concrete Association (THBB) released the June 2019 report on its "Ready-Mixed Concrete Index." All index values in the June 2019 Ready-Mixed Concrete Index Report indicated that current and expected activity levels in the construction sector are insufficient. Since April, the indices have moved downward. Beyond confidence issues in the economy, sector-specific uncertainty in construction pulled expectations lower. According to the June 2019 Ready-Mixed Concrete Index Report, all three indices showed declines compared to the same period in the previous year. The relatively sharp decline in the Confidence Index stemmed from both macroeconomic developments and the bottleneck the construction sector is currently experiencing. The report revealed no signs of recovery in the sector. Evaluating the results of the June 2019 Ready-Mixed Concrete Index Report, European Ready Mixed Concrete Association (ERMCO) and THBB Board Chairman Yavuz Işık stated, "All index values demonstrate that current and expected activity levels in the construction sector are insufficient. All three indices showed declines compared to the same period in the previous year. There are no signs of recovery in the sector." Assessing economic developments, Yavuz Işık said, "The decline seen particularly in food inflation within inflation figures could create some movement in inflation-indexed housing loans. However, we do not expect this to have a significant impact on the construction sector in the short term. At the July meeting, the increased likelihood of the Central Bank cutting interest rates alongside declining inflation will be the primary determinant of housing loans. We do not expect a possible interest rate cut in July to be at a level that would trigger loan volume, which is far more sensitive to interest rates compared to other credit types such as housing loans. As long as the construction sector cannot see its way forward, it unfortunately will not be able to contribute to Turkey's growth."