The Dimension of Central Bank’s Intervention in the Draw Revealed

While the depreciation of the Turkish Lira continues, we see rapid increases and extreme fluctuations in the exchange rate. As a result of this situation that has continued in recent weeks, the dollar has reached the level of 14 against the TL, and many products have increased by at least 50% with the increase in the dollar. While the great activity continued, it was a matter of curiosity whether the Central Bank of the Republic of Turkey would directly intervene in the exchange rate.

If that was the case, it ended yesterday. For the first time since 2014, the Central Bank has officially in foreign exchange intervention announced that it will. The intervention of the Central Bank by selling to the market meant selling the dollar in reserves to the market. The dollar, which was circulating at 13.70 levels before this announcement, immediately after the Central Bank’s statement and intervention. up to 12.40 levels had been taken. Today, the first dimensions of the Central Bank’s intervention have been announced.

So far, a total of 1 billion dollars of intervention has been made.

According to the information obtained by Bloomberg HT, the Central Bank of the Republic of Turkey, with direct intervention, 700 million dollars foreign exchange sales. While the transaction size of the first intervention made at noon was close to 500 million dollars, the intervention after the market calmed down in the afternoon, 200 million dollars took place as

In addition to this, the Central Bank also has approximately 340 million dollars performed the transaction. Thus, the total size of the Central Bank’s intervention reached $1 billion. It was stated that the intervention was based on liquidity and volatility, and the aim was to prevent unhealthy price formation.

• The Central Bank has a statutory period of 15 days to disclose the net magnitude of the intervention.
• of the Central Bank intervention in 20143 billion 151 million dollars of foreign exchange selling auction was held.

How did the intervention of the Central Bank affect the market?

As we mentioned above, in the first minutes of the announcement of the intervention, the dollar was withdrawn from 13.70 to 12.40. However, after that, the dollar/TL parity remained stable at 13.20 levels. In the morning hours, it was above the 13.50 level. dollar right now It’s hovering around 13.30 levels.