Turkey’s foreign exchange reserves hit their highest level of the year, at about $109 billion, amid news of a Russian loan to finance Russia’s Rosatom’s construction of Turkey’s first nuclear power plant.
Turkey’s central bank’s total reserves rose by $7.4 billion in the week ending August 5, the biggest increase in 12 months, according to data from the Monetary Authority.
In that increase, foreign exchange accounted for $6.7 billion, she said, with the rest being gold. Bloomberg agency. Turkish Central Bank data.
The agency said the two-week increase in Turkey’s sovereign assets since Finance and Treasury Minister Nureddin Nabati announced huge transfers from abroad has now topped $10 billion.
The agency has indicated that Russia is likely the source of these transfers, as Turkish officials told Bloomberg last month that Rosatom is in the process of transferring $15 billion to a Turkish subsidiary to finance construction of the Akkuyu nuclear power plant. coast of the Mediterranean Sea worth $20 billion.
Economist Haluk Borumciqi, citing official data, said company foreign-currency deposits in Turkey rose by about $4.4 billion over the same period, likely as a result of remittances from Russia.
A breakdown of weekly reserves data showed an increase of $1.8 billion in FX swaps against the lira over the most recent period.
Commercial lenders can deposit some of the cash to the central bank in what is known as a warehouse mechanism.
The movement of funds between foreign creditors, Turkish commercial banks and the monetary authorities highlights the competing financial priorities of politicians in Ankara.
Source: Bloomberg.