CBRT's forex sales since fund crisis reach $16.1 billion

The Central Bank of the Republic of Turkey conducted $5.7 billion in forex sales last week following the investment fund crisis that began on September 11; total sales since the crisis have reached $16.1 billion.

According to analysis by QNB economists, total reserves declined by $6.8 billion in the week ending October 23. While the increase of $1.9 billion in foreign currency held by banks at the CBRT for mandatory reserve requirements and collateral deposits had a positive effect on gross reserves, net reserves excluding this impact fell by $8.7 billion to $42.8 billion. Net reserves excluding swaps declined by $8.6 billion in the same week and retreated to the $30.8 billion level.

Since September 11, total losses in net reserves excluding swaps have reached $19.2 billion. Total reserves stood at $178.7 billion in the week of September 11; the decline following the crisis was calculated at $16.4 billion.

QNB economists noted that the decline in gold prices led to an additional $2.5 billion decrease in net reserves. The public's foreign currency deposits also fell by $0.4 billion in the week examined.

The Central Bank made purchases of $5.7 billion only in the week of October 9 during the crisis period; it remained a seller in all other weeks. Total forex sales since the beginning of the year have reached approximately $26 billion.