ANKARA - TURKEY'S industrial output plunged by a record 23.7 per cent in February compared to activity 12 months ago, official data showed on Wednesday, strengthening expectations that the once-booming emerging market economy is heading into recession.

Wednesday's slump was the seventh month in a row that industrial production declined amid contracting domestic demand and falling exports as Turkey is hit by the global economic downturn.

The data, published by the Turkish Statistics Institute, showed that the biggest contraction was in the automative sector which plummeted by a staggering 58.7 per cent. Manufacturing industry output was down by 25.9 per cent in total, the institute said.

'We expect a similar output performance in March. However we expect some recovery starting in April as the recently introduced tax cuts have led to inventory depletion in some of the key industries such as the automotive,' Yarkin Cebeci, a senior economist at JP Morgan, said.

Last month, the Turkish government announced tax cuts in the housing, automotive, appliances and electronics sectors for three months in a bid to revive falling demand.

The February figures also increase pressure on the central bank to cuts its key rates as the decline in demand pulls down inflation which hit 7.89 per cent in March.

'This result supports the case for another 50 basis point cut by the Central bank in this month's monetary policy meeting,' Cebeci said.

In March, the central bank trimmed its key borrowing rate to 10.5 per cent in the fifth consecutive cut since November.

Analysts underlined that the figures point to a deeper contraction in gross domestic product (GDP) in the first quarter of the year after the economy slumped a massive 6.2 per cent in the last quarter of 2008.

The Turkish economy had been one of the strongest in the region in recent years, having grown by 8.4 per cent in 2005, 6.9 per cent in 2006 and 4.7 per cent in 2007 under recovery programmes backed by the International Monetary Fund in the wake of two severe financial crises. -- AFP