Friday 23 / May / 2025
Istanbul: The Turkish central bank said on Monday some 5.3 billion lira ($1.37 billion) of lira liquidity will be withdrawn from the market and some $1.4 billion of dollar liquidity provided to banks under a change in reserve requirements.
The move came after markets "witnessed unsound price formations that are inconsistent with economic fundamentals," the bank said in a statement, an apparent reference to the lira currency's weakness on Friday, when it slid to 3.88 against the dollar, from 3.80 a day earlier.
The moves were "light measures to stop the bleeding" in the currency, said Ozgur Altug, chief economist at BGC Partners, in a note to clients.
"We do not think that those measure will be a quick fix to (the) depreciating TL, but the announcement impact is certainly there and positive for TL," he said.
After the bank's moves, the lira firmed to 3.8680 by 0721 GMT.
The bank said the upper limit for the forex maintenance facility had been lowered to 55 per cent from 60 per cent and all tranches have been reduced by 5 percentage points.
The rediscount credit repayments for export and foreign exchange earning services due by February 1 can be made in lira at a rate of 3.7 for dollars, 4.3 for euros and 4.8 for sterling, provided that they are paid at maturity, it said.
An official said rediscount credit repayments due by February 1 amounted to $5 billion.
