ISTANBUL, March 29 (Reuters) - The Turkish lira steadied on Friday morning, after tumbling 5 percent a day earlier, as liquidity returned to a key London foreign-exchange market.
In an interview late on Thursday, Finance Minister Berat Albayrak said Turkish banks were providing billions of lira to foreign markets and normalisation in market conditions, both locally and in London, had begun. .
The lira stood at 5.5800 against the dollar at 0430 GMT after closing at 5.5825 on Thursday, when it weakened as far as 5.6465. Last year, it tumbled almost 30 percent against the U.S. currency.
Speaking to Turkish broadcaster NTV, Albayrak said Turkey would enter a reform period after nationwide local elections on Sunday but did not provide specific details as to what the government plans to do.
He said a framework of steps to be taken may be announced in the week of April 8 if the plan is ready.
A major liquidity squeeze pushed the London swap rate to a record 1,200 percent on Wednesday but it slid back to 35 percent on Thursday as the swap market revived.
President Tayyip Erdogan blamed the currency’s weakness on attacks by the West.
Erdogan told young voters on Thursday that some banks were playing a game with the currency ahead of the elections and renewed his calls for lower interest rates despite double-digit inflation and a weak lira.
The lira has been hit by a lack of confidence among Turks, leading them to snap up record holdings of dollars and gold. Uneasy relations with the United States and concerns about post-election government policy also hurt sentiment. (Reporting by Daren Butler; Editing by Kim Coghill)