The total reserves of the Turkish central bank are foreseen to have risen to the highest level since September 2014, four bankers’ calculations showed on Tuesday.
It marks a continuation of the uptrend since the Central Bank of the Republic of Türkiye (CBRT) adopted a more conventional policymaking after the May elections.
The CBRT’s total reserves rose $6 billion last week to $134.5 billion, the bankers’ calculations showed. The reserves are now $36 billion higher than the $98.5 billion level at the end of May following the elections.
Since June, when President Recep Tayyip Erdoğan appointed former Wall Street banker Hafize Gaye Erkan as its governor, the bank has embarked on a 2,650 basis-point tightening cycle – including hikes of 500 basis points in each of the last two months.
The central bank did not comment on the reserve figures. The official data will be released on Thursday.
The rise came after Türkiye borrowed $2.5 billion in a 5-year sukuk at a sharply lower 8.5% yield this month, marking its first international bond issue since the elections. Those funds entered Treasury accounts on Nov. 14.
During the election period, CDS were higher than 700 basis points.
After winning reelection, Erdoğan named a new Cabinet, including two internationally accomplished bankers, Mehmet Şimşek as Treasury and Finance minister and Erkan as the governor of the central bank.
The administration reversed the yearslong easing cycle and launched aggressive interest rate hikes to tackle inflation, which eased to 61.4% last month but is expected to grow in the period ahead and peak at 70%-75% in May before dipping.
