The Central Bank of the Republic of Turkey’s (CBRT) foreign reserves shrank to its lowest level since January this year by 12.7 billion dollars, Financial Times reported.
Financial Times, known as one of the world’s leading global business publications, stated that CBRT’s foreign reserves fell from 14.2 billion dollars to 12.7 billion dollars this week. Foreign reserves rose from 25.9 billion dollars to 27.2 billion dollars during this period, but after deduction of short-term foreign debt, Turkey’s reserves dissolved almost 2 billion dollars in a week, figures show.
The newspaper commented that, except for the short-term debt of 35 billion dollars at the end of February, a sharp decline of CBRT’s reserves is causing growing anxiety among investors. In March, CBRT’s net foreign reserve decreased by 10 billion dollars.
The Turkish lira lost historical value of more than 40 percent since last August due to Ankara’s tension with Washington over the Pastor Andrew Brunson crises, Turkey’s Russian S-400 missile order, the threat of US sanctions, and the annulment of the Istanbul elections. CBRT’s declining reserves have investors worried, and many Turkish firms are joining foreign investors in shifting their assets out of the country.
According to Treasury and Finance Ministry data, Turkey’s budget recorded a 54.5 billion lira deficit in the first four months of this year, and the government’s forecast for the 2019 year-end deficit is 80.6 billion lira, Reuters reported.
The Turkish economy fell into its first recession in a decade, recording two consecutive quarters of falling economic growth. The Turkish Statistical Institute announced that Turkey’s gross domestic product shrank by 2.4 percent in the fourth quarter of last year, and declined 1.6 percent in the previous quarter.