I like a good mystery, so I have been writing about the ones in Turkish Economics, such as UFOs (unidentified financing objects), from time to time. A mystery I have not mentioned until now is the recent break in the link between import taxes and actual imports. Again, a picture is worth more than a thousand words:
As you can see, import taxes and imports used to move in perfect sync until recently. This was rather convenient for Turkey economists, as they could use import taxes to predict imports, as the former is released earlier than the latter. While they can still adjust their regressions to come up with good forecasts, the relationship has been broken. And today's trade release continued the recent tradition with spitting out an imports figure smaller than as predicted from taxes.
I have read quite a few explanations for this seemingly enigmatic relationship, none of which I have found satisfactory. So for me, this is still a riddle.
By the way, I will come back to today's data releases, namely growth and trade, tomorrow, if not later tonight.
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