ISTANBUL: Turkey's industrial production is seen expanding 6.7% annually in June, continuing a strong two-year run despite rampant inflation and an ailing currency, a Reuters poll showed on Friday.

Output has made a strong recovery from the initial coronavirus wave in April of 2020.

Economists expect the pace of growth in the index to slow in coming months. A potential drop in external demand or a supply chain disruption due to Russia's invasion of Ukraine could also hit production.

The median estimate in the Reuters poll of six institutions showed year-on-year growth of 6.7% in the calendar-adjusted industrial production index in June.

Forecasts for the index, seen as a preliminary indicator of economic growth, ranged between 5.5% and 9.9%.

Albaraka Turk Economist Lutfullah Bingol said the growth in the index could slow as of July however a possible improvement in chip shortages in automotive sector could dampen the slowdown in other sectors during the rest of the year.

Turkish March factory output rises 9.6% yr-on-yr, beats forecasts

"We expect a slight slowdown in the growth of the industrial production index in July. However, if the chip issue in the automotive sector is resolved, it may balance the calm in other sectors for the rest of the year," Bingol said.

"For this reason and because of the very good course in tourism, we still expect year-end growth to be over 4%."

Turkey's economy grew 11% last year, up sharply from a year earlier. But a sharp selloff in the lira in December upended company and household budgets, and sent inflation soaring via import prices.

The currency crisis and resulting jump to 80% inflation, as well as fallout from war, are expected to hamper growth in 2022.

The Turkish Statistical Institute will announce June industrial production figures at 0700 GMT on Aug 12.