The Turkish Central Bank saw a sharp decline in its foreign currency reserves over the past week, losing nearly $22 billion. This significant deterioration reflects the enormous pressures that the Turkish lira is facing in the markets. These huge losses are due to the major interventions made by the bank with the aim of supporting the local currency, which is suffering from a continuous decline, in conjunction with the high demand for foreign currencies by individuals and companies.
The numbers show that this decline is the largest of its kind in just one week, which raises concerns about the ability of the central bank to continue protecting the national currency in light of the depletion of foreign reserves.
This decline coincided with an atmosphere of economic and political uncertainty, which prompted financial institutions to track the extent of the remaining reserves’ ability to be sustainable and evaluate Ankara’s ability to control inflation and stabilize the “exchange rate.”
