Turkish central bank’s forex reserves dropped by $1.1 billion last week: report

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AFP PHOTO / OZAN KOSE

The Turkish central bank’s gross foreign currency reserves dropped by $1.1 billion in the week to March 27 as the authorities continued to defend the weakening lira amid the coronavirus pandemic, the Ahval news website reported.

The decline means that the bank’s reserves, excluding gold, have declined by almost $13 billion in a month to $64.1 billion, according to data published on Thursday. Its reserves including precious metals have fallen to $95.4 billion from $107.8 billion on Feb. 28, the figures showed.

Turkey is seeking to defend its currency against losses this year that total more than 10 percent. This week, the lira fell to its weakest levels since a currency crisis in the summer of 2018 during a sell-off in emerging markets sparked by the spread of the coronavirus.

The lira edged up by 0.3 percent to 6.77 to the dollar in late afternoon trading in Istanbul on Thursday after touching an 18-month low of 6.71 to the dollar earlier in the day.

The central bank has engaged in swap transactions with state-run banks over several months to help stem the lira’s declines, meaning a substantial portion of its net reserves, which total less than half of gross reserves, are now borrowed.

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