CBRT Increases the Swap Rate to 17 Percent

CBRT Increases the Swap Rate to 17 Percent CBRT increases the swap rate to 17 percent. After the policy rate was raised, the TL interest used in weekly swap transactions was also increased from 15 percent to 17 percent. Central Bank of the Republic of Turkey has raised the interest rate used in per-week swap operations. The bank increased the swap rate from 15 percent to 17 percent. Thus, the increase in the policy rate had its effect on swap rates as well. In August, the swap interest was at 9.75 percent. However, it had been gradually increased over the past months and reached the level of 15 percent as of November 20. At the Monetary Policy meeting held on Thursday, the CBRT decided to increase the policy rate by 200 basis points above the market expectations and increased the policy rate to 17 percent. Bloomberg HT Research Manager Cumhur Örnek commented on the increase in swap interest as follows: “The 200 basis points increase in the CBRT policy rate reflected on the TL rate used in the weekly swap window. This policy has been going on for a while. It is relatively higher than the interest formed abroad. Therefore, the weekly swap stock has recently declined from $ 9 billion to $ 3 billion. However, in this period, the CBRT added a one-month maturity to its traditional swap auctions and no major changes occurred in the total stock figure. In his presentation of the 2021 Monetary and Exchange Rate policy text, CBRT President Naci Ağbal stated in the question and answer section that he expected a decrease in the swap stock next year. When we look at the strategy followed recently, we see a strategy that reduces the average swap maturity is followed. According to the data compiled by Bloomberg HT Research, it is seen that the average maturity of foreign currency swaps that are not due except BIST is 43 days.”