ISTANBUL, April 1 (Reuters) - Turkey's economy grew less than expected in the fourth quarter, bringing growth last year to just 2.2 percent, short of economists' forecasts as domestic demand slumped, official data showed on Monday.
Turkey's gross domestic product (GDP) grew 1.4 percent year-on-year in the fourth quarter, well below a Reuters poll forecast of 2.3 percent growth, data from the Turkish Statistics Institute showed.
Last year as a whole, GDP expanded 2.2 percent, compared with a poll forecast of 2.6 percent. Seasonally-adjusted, fourth quarter GDP was unchanged from the previous quarter.
According to revised figures, third quarter growth was 1.6 percent, unchanged from initial data. Second quarter growth was revised to 2.9 percent from 3.0 percent and first quarter growth was revised to 3.3 percent from 3.4 percent.
The lira and bond yields were unmoved by the data.
By 0702 GMT the lira was at 1.8126 to the dollar from 1.8125 before the data and from 1.8096 late on Friday. The benchmark two-year bond yield was at 6.37 percent, from 6.36 percent on Friday.
A double-digit rise in exports last year bolstered Turkey's resistance to the slowdown blighting much of Western Europe, but a collapse in domestic demand reduced overall growth sharply after expansion of 8.5 percent in 2011.
In response, the central bank has been trying to spur the economy since mid-2012 and embarked on a campaign of cuts in official rates in September. A large current account deficit, Turkey's main economic weakness, has limited the central bank's room to cut rates too aggressively.
In a characteristically complex policy move, last week the central bank cut its overnight lending rate by 100 basis points to 7.5 percent but held its borrowing and one-week repo policy rates at 4.5 and 5.5 percent, respectively.
GDP is forecast to grow 4.5 percent this year, according to a Reuters poll of 15 economists.
Ratings agency Standard & Poor's raised Turkey to within a whisker of investment grade on Wednesday, citing a rebalancing economy and progress in a Kurdish peace process, but the move failed to impress the country's finance minister.
(Writing by Daren Butler; Editing by Nick Tattersall) Keywords: TURKEY GDP/
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