Turkey's central bank reserves surge to record high of $145.5 Bln

By Al Mayadeen English
Source: Agencies
28 Dec 2023 20:26
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Turkey's Central Bank reserves have surged to a record $145.5 billion, marking an impressive increase of $47 billion since May.

Two men pull trollies with goods in a street market in a commercial district in Istanbul, Turkey, Thursday, Dec. 21, 2023. (AP)

Turkish newspaper Daily Sabah reported on Thursday that Turkey's Central Bank reserves have skyrocketed, reaching an all-time high of $145.5 billion. This reflects a $47 billion increase since the month of May, signaling robust economic activity.

In a strategic move to address economic challenges, the Central Bank declared its commitment in June to gradually tighten monetary policy. This initiative aims to persist until a significant shift occurs in the high inflation forecast. Over the intervening period, the key interest rate has seen a substantial adjustment, escalating from 8.5% to 42.5%.

Turkey faced a considerable inflationary surge, reaching approximately 62% in November, causing concerns about economic stability. Correspondingly, the Turkish lira witnessed a consistent decline against the US dollar throughout the year 2021.

On November 22, President Recep Tayyip Erdogan made a significant announcement, declaring an end to the lira's decline and expressing a high likelihood of the currency gaining strength against the US dollar.

Since the commencement of 2023, the Turkish currency has experienced monthly depreciation, except a respite in August. Notably, June witnessed a substantial decline of nearly 25%, as the lira fell from 20.8 liras to 26 liras per dollar. The subsequent month saw the exchange rate surpassing 27 liras.

October marked a historic low for the Turkish currency, dipping below 28 liras per $1 for the first time in history.

In a statement made in July, Turkish Central Bank Chief Hafize Gaye Erkan expressed optimism regarding the stabilization of the Turkish economy, setting a target year of 2025 for achieving this crucial milestone.