The Turkish lira continued to fall, as on Wednesday, the Turkish currency hit a record low level of more than 27.3 against the dollar, due to inflationary pressures and the rise of the dollar, and its losses on an annual basis reached more than 31%.
The Turkish Central Bank recently announced a series of measures aimed at supporting the lira and making it more attractive to investors, including canceling the minimum interest rate requirements.
It also began last August to gradually abandon a program to protect deposits in the lira from exchange rate fluctuations.
Last Thursday, the Turkish Central Bank announced that it would raise the key interest rate by 500 basis points, to 30%, to combat inflation, which is the highest level in 20 years.
Since last June, the Turkish Central Bank said that it had stopped interfering in the foreign exchange market to support the lira.
It had also shifted away from its previous monetary policies by reducing the interest rate and made two strong increases to it during last August and this September.
The Turkish lira has lost about 24% of its value since the bank policy changed.
Meanwhile, concerns are increasing in Türkiye regarding the acceleration of interest rate hikes in recent months, which have reached 30%, compared to less than 10% 4 months ago, and the business sector fears negative repercussions represented by an increase in production costs and a decline in export capacity.
However, international reserves at the Turkish Central Bank rose, according to bankers, by more than $6 billion last week, to about $24 billion, continuing to rise after the bank stopped interfering in the foreign exchange market, bringing the total reserves, as of September 22, to about $125.5 billion according to bankers’ calculations based on indicators issued by the Central Bank.