Turkey's net FX reserves lowest in 18 years at $10.68 billion

ISTANBUL (Reuters) - The Turkish central bank’s net international reserves fell to its lowest level since 2003 at $10.68 billion as of April 2, from $12.79 billion a week earlier, data showed on Thursday.

The exchange rate used by Reuters on Thursday was 8.1707 compared to 7.9409 the previous week.

The reserves plunged last year as state banks sold off an estimated $130 billion to stabilise the lira, which still lost 20% of its value in 2020. Net forex reserves were around $41 billion at the end of 2019.

Analysts say the central bank used swaps with local banks in 2019 and 2020 to prop up its forex reserves. The unorthodox policy spooked foreign investors and raised the risk of a balance of payments crisis, though the bank pledged earlier this year to replenish the buffer.

Data showed the bank’s outstanding swap transactions stood at $41.116 billion by Wednesday. The reserves are in deeply negative territory once the swaps are deducted.

Compiled by Ezgi Erkoyun