TL Declined Before The CBRT Meeting

TL declined before the CBRT meeting. The appreciated dollar suppresses the Turkish Lira.

This week, when the Central Bank of Turkey's (CBRT) March meeting will be held, started high for the domestic markets. While bond yields continued to rise in global markets, the latest appreciation of USD put pressure on the TL. The Turkish Lira, which has been falling against the US dollar for the last 3 weeks, started the week when domestic markets were waiting for the interest rate decision of the Central Bank of the Republic of Turkey (CBRT). In the first transactions in USD/TL, above the level of 7.61 was tested. While the markets expect an interest rate increase of 100 basis points from the CBRT, the directions of the FED are a matter of curiosity. On the other hand, Turkey's risk premium is traded at 325bp, while the benchmark bond rate appears at 16.38 percent.   Foreign Exchange Deposits Decreased According to the CBRT's weekly money and bank statistics, the foreign currency deposits of domestic residents decreased by $ 2.25 billion to 230.4 billion in the week of March 5. According to the said data, in the same period, there was a decrease of 1.8 billion dollars in foreign exchange deposits of individuals and 441 million dollars in foreign exchange deposits of legal entities. Looking at the data set adjusted for the parity effect published by the CBRT for 3 weeks, it was seen that there was an increase in foreign exchange deposits. Accordingly, CBRT calculated the parity effect as 2.65 billion dollars on the week of March 5, when foreign exchange deposits fell by 2.25 billion dollars. Excluding this effect, an increase of approximately $ 400 million was recorded in foreign currency accounts.