NEWS Finance        28/01/2021

Turkish Central Bank’s gross reserves increased by 12.8% to USD 93.3 billion in December 2020

According to the Turkish Central Bank’s International Reserves and Foreign Currency Liquidity report, the Bank’s total gross reserves increased by 12.8% in the month of December 2020. The reserves value as of December 31st, 2020 was USD 93.3 billion, compared with USD 82.7 billion as of the end of November 2020.


In December 2020, the Bank’s foreign currency reserves, in convertible foreign currencies, increased by 17.8% to USD 48.5 billion, and its gold reserves increased by 8.1% to USD 43.2 billion, compared with the previous month of November. 


The 2020 yearend total gross reserves figure of USD 93.3 billion represents a 11.6% decrease from the USD 105.5 billion figure for 2019 yearend. The 2019 yearend total gross reserves figure of USD 105.5 billion in turn represented a 13.4% increase over the USD 93 billion figure for 2018 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 December 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 2.4 percent to USD 28.3 billion, of which almost USD 23 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 61.9 billion, of which USD 23.4 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 46.7 billion increasing by 15.6 percent compared to the previous month.”


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. These transactions have resulted in a negative reserve balance, which was calculated as -USD 49.5 billion as of the end of November 2020.


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