NEWS Finance        28/12/2020

Turkish Central Bank’s gross reserves decreased by 2.2% to USD 82.7 billion in November 2020

According to the Turkish Central Bank’s International Reserves and Foreign Currency Liquidity report, the Bank’s total gross reserves decreased by 2.2% in the month of November 2020. The reserves value as of November 30th, 2020 was USD 82.7 billion, compared with USD 84.5 billion as of the end of October 2020.


In November 2020, the Bank’s foreign currency reserves, in convertible foreign currencies, increased by 0.7% to USD 41.1 billion, whereas its gold reserves decreased by 5.1% to USD 40 billion, compared with the previous month of October. 


The 2019 yearend total gross reserves figure of USD 105.5 billion represents a 13.4% increase over the USD 93 billion figure for 2018 yearend. The 2018 yearend figure had itself represented a decline of 13.6% from USD 107.7 billion at 2017 yearend. In mid-December 2013, the Bank's total reserves had reached their all-time peak of nearly USD 136 billion, including some USD 21 billion in gold reserves. 


With regards its short-term liabilities in November 2020, the Bank made the following declaration on its website :


“Short term predetermined net drains of the Central Government and the CBRT (foreign currency loans, securities, FX deposit liabilities) increased by 6.1 percent to USD 27.6 billion, of which USD 22.3 billion in principal repayments and USD 5.3 billion in interest payments. Additionally, outstanding FX and gold liabilities arising from the CBRT’s financial derivative activities with resident and non-resident banks recorded USD 63.4 billion, of which USD 27.6 billion is due in one month.


Contingent short-term net drains on foreign currency consists of “collateral guarantees on debt due within one year” and “other contingent liabilities (“Required Reserves in Blocked Accounts in Foreign Currency and Gold” and “Letters of Credit” items in the CBRT’s balance sheet). These liabilities recorded USD 40.4 billion increasing by 4.6 percent compared to the previous month.”


The Bank’s net reserves after foreign currency and gold amount balances borrowed through swap transactions have been removed show a negative balance of USD 49.5 billion. Foreign currency and gold borrowed through swap transactions from both foreign and domestic banks in November totals USD 63.4 billion, compared with USD 66.8 billion in October. Of the USD 63.4 billion swap transactions in November, USD 58 billion were foreign currency swaps and USD 5.4 billion were gold swaps. In the total swap liability figure is USD 15 billion relating to Qatar Central Bank and USD 1 billion relating to China’s Central Bank. The rest were handled through domestic banks. The net reserves negative figure was USD 13.9 billion in November, compared with USD 18.9 billion in October.


Market analysts have estimated that in the 22 month period of January 2019 through to October 2020, some USD 128 billion in foreign currency reserves have been sold through state banks to protect the Turkish lira. This claim has yet to be responded to by the Turkish Central Bank.

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