UPDATE 1-Turkish cenbank governor defends 2019/20 forex reserve sales -Anadolu

  • 4/16/2021
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(Adds quotes from governor, background) ANKARA, April 16 (Reuters) - Turkey’s central bank conducted forex transactions within market conditions and did not provide “privileges” to any bank or firm, its governor was quoted as saying on Friday, after the main opposition party questioned how the sales were managed. The Republican People’s Party (CHP) has been pressuring President Tayyip Erdogan and his AK Party over $128.3 billion of the bank’s reserves that were sold via state banks in 2019 and 2020 to prop up the lira. They also want to know at what rate the sales took place. State-owned Anadolu agency quoted central bank Governor Sahap Kavcioglu as saying none of the bank’s assets were lost. “The forex transactions in question were conducted via transaction platforms within the framework of the market conditions and prices of that day,” he said. “It is not the case that any privileged forex transaction was made with any section, bank or firm.” He added that the bank had signed a protocol with the Treasury Ministry in 2017 to coordinate forex purchases and sales, which had helped prevent unhealthy price formations. Erdogan and other AKP lawmakers have staunchly defended the sales, saying they helped support the economy during an extraordinary period. But they also sharply depleted Turkey’s buffer of foreign reserves. The CHP has put up posters around Istanbul and other cities this week, pressing Erdogan’s government about where the reserves have gone but police took them down soon after. The bank’s net forex reserves stood at $9.93 billion on April 9, the lowest since April 2003, central bank data shows. Excluding $42.5 billion in outstanding swaps, the reserves are deeply negative. (Reporting by Ezgi Erkoyun and Daren Butler; Writing by Ali Kucukgocmen, Editing by Ece Toksabay, Kirsten Donovan)

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