ANKARA: Central Bank of the Republic of Turkey said that $1.5 billion will be added to reserves through increases in reserve requirements for commercial banks.
Turkish banks must hold required reserves at the Central Bank of Turkey against liabilities. The Central Bank is imposing measured increases in reserve requirement ratios as of March 27, the bank said in a statement.
There will be measured increases in reserve requirement ratios for the non-core short-term foreign exchange liabilities,” the CB said.
Thereby, foreign exchange liquidity for the banking system together with incentives for longer term borrowing will be provided,” the statement said.
Turkey’s Central Bank reserves increased almost $768 million to $128.48 billion in the week leading up to February 27 according to weekly Central Bank figures.
The Bank’s gross foreign exchange reserves were up nearly $1.3 million and reached $108.6 billion.
However, gold reserves decreased by $544 million during the week and remained at $19.8 billion.
The reserve requirement ratios are important monetary policy instruments for central banks. The bank uses its reserve to sell dollar to protect Turkish liras against foreign currencies.
