The Turkish economy grew by 2.5% year-on-year in Q1 2026, slowing from 3.4% in the previous quarter and falling short of market expectations for 2.7% growth. This was the weakest expansion in a year, reflecting a moderation in key demand components. Household consumption growth eased to 4.8% from 5.2%, while the pace of fixed investment decelerated to 3.0% from 5.4%.
Net exports further dragged on growth. Exports slumped 12.7%, whereas imports fell by a more modest 2.0%. In contrast, government consumption rebounded, rising 2.1% following a 0.9% contraction in the previous quarter.
From the production side, manufacturing output shrank by 1.4% after a 0.9% increase in Q4, contributing to the overall loss of momentum. Growth also slowed in construction (3.2% vs. 8.6%), trade and transport (3.7% vs. 4.2%), and financial and insurance activities (3.5% vs. 4.1%). Meanwhile, agriculture, forestry, and fishing returned to growth, expanding 4.6% after a 7.2% decline, and the information and communication sector accelerated to 9.5% from 8.9%.
On a quarterly basis, GDP rose just 0.1%, down from 0.4% in Q4, marking the weakest quarterly performance since the contraction recorded in Q2 2024.
