The Turkish central bank’s net international reserves rose around $2.7 billion to $11.81 billion in the week to Aug. 5, rising to their highest level since late May, data from the central bank showed on Thursday.
The exchange rate used by Reuters on Thursday was 17.9350. Net forex reserves had dropped to $6.07 billion on July 8.
Forex reserves have dropped sharply in recent years, most recently due to the billions of dollars the bank sold in market interventions in the wake of a currency crisis in December.
The lira ended the year down 44 per cent against the dollar in 2021, a slump which helped send inflation soaring to 79.60 per cent in July, the highest under President Tayyip Erdogan’s rule.
The currency is down nearly 27 per cent against the greenback this year.
The central bank has met the market’s need for more than $30 billion of forex since December through its reserves, in addition to direct interventions in the forex market in 2019-2020, when it sold $128 billion to support the lira.
Its net forex reserves touched $19.13 billion on April 15 before beginning to decline again.
In past years, the bank used swaps with local banks to backstop interventions, an unorthodox policy that spooked foreign investors and local savers.
Data showed the bank’s outstanding swap transactions stood at $44.47 billion as of Wednesday. The reserves are in negative territory once the swaps are deducted.
Note: The figures are released every week on the central bank balance sheet as per a letter of intent with the International Monetary Fund dated 18 January 2002.
The figures are released in Turkish liras and are converted by Reuters to US dollars using the central bank’s official exchange rate from the previous work day.