THE RELATIONSHIP BETWEEN CONSUMER AND REAL SECTOR CONFIDENCE INCIDES AND THE SELECTED MACROECONOMIC VARIABLES IN TURKEY: 2010-2018

The purpose of this study is to analyse how Consumer and Real Sector Confidence indices are related with the chosen macroeconomic variables using VAR model. In this context, two separate models are created. The first model examines the relationship between Consumer Confidence Index and the other variables such as Consumer Price Index, exchange rate and BIST-100 Index. The second model investigates the connection between Real Sector Confidence Index and the other variables such as Industrial Production Index, benchmark interest rate and employment rate. A data set of 108 monthly observations is used in the study for Turkey for period of 2010:01-2018:12. The empirical findings obtained in both models reveal that there is an interrelation between the abovementioned confidence indices and the selected macroeconomic variables