Turks' hard currency holdings slump after cenbank chief removal
- The holdings have eased from a record high of $236.11 billion in January. When adjusted with the parity effect, the data showed the hard currency holdings dropped by $8.13 billion in the week to March 26.
- The lira briefly fell 15% to near its all-time low in a dramatic selloff after President Tayyip Erdogan sacked the hawkish former Central Bank Governor Naci Agbal.
ISTANBUL: Turkish locals' forex and precious metals holdings fell to $223.67 billion as of March 26, according to central bank data on Thursday, as investors sold forex following central bank governor removal.
They stood at $232.50 billion a week earlier.
The holdings have eased from a record high of $236.11 billion in January. When adjusted with the parity effect, the data showed the hard currency holdings dropped by $8.13 billion in the week to March 26.
The lira briefly fell 15% to near its all-time low in a dramatic selloff after President Tayyip Erdogan sacked the hawkish former Central Bank Governor Naci Agbal.
Turks flocked to hard currencies in recent years as a hedge against double-digit inflation and an ailing lira, which lost 20% of its value against the dollar last year. The central bank is watching keenly for a reversal in this dollarisation trend before it starts rebuilding its depleted FX reserves.
Data also showed on Thursday that foreign investors sold $1.10 billion worth of Turkish government bonds in the week to March 26, as well as $813.9 million worth of stocks.
Separately, the central bank's gross forex reserves fell to $50.89 billion in the same period from $$53.90 billion a week earlier.
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