ANKARA (Reuters) - Turkish locals have trimmed their holdings of hard currencies for a second straight week to below $233 billion, edging further away from a record high and raising the prospect that a long-term dollarization trend may be turning around. Turkey’s new central bank governor, Naci Agbal, has said a reversal of this trend - and signs of renewed faith in the lira currency - will be an important signal as the bank decides when to start rebuilding its own badly depleted FX reserves. Aggressive interest rate hikes since November, when Agbal was appointed, have led to a 20% rally in the lira and some $20 billion in foreign investment inflows. But Turks, stung by 15% inflation and a 50% drop in the currency in three years, have been more cautious. They added more than $75 billion in hard-currency holdings in the last two years, driving them to a record $236 billion last month. Yet in the first two-week drop since September, locals’ forex and precious metals holdings fell by $2.13 billion to $232.93 billion in the week to Feb. 5, according to central bank data on Thursday. “Recently we see locals have almost no orientation toward forex,” said a Treasury desk official at one Turkish bank. “It may be an important sign that de-dollarization has begun.” The reversal could encourage the central bank to begin considering when to hold FX auctions to replenish its reserves, which on a net basis dropped by three-quarters in a year. In an interview last week, Agbal told Reuters signs that Turks are shifting toward lira assets suggests a reversal in dollarization may come. “We will increase our reserves as a result of a strong disinflationary process emerging and becoming lasting, (and) capital inflows becoming stable and strong, and with the reversal of the dollarisation tendency of lals,” Agbal said. The central bank’s gross FX reserves rose to $54.37 billion last week from $53.37 billion, while its net FX buffer climbed to $14.02 billion from $13.77 billion, separate data showed. Net reserves began last year at around $41 billion. But they tumbled as state banks sold off an estimated $130 billion to stabilize the ailing lira, which still lost 20% of its value in 2020. Analysts say the central bank used swaps with local banks to prop up its forex reserves. Data showed the bank had outstanding swap transactions worth some $40 billion, meaning the reserves are in deeply negative territory once swaps are deducted. Data also showed foreign investors bought $140.5 million worth of Turkish government bonds last week, and sold $183.2 million worth of stocks.