Will the dollar rate continue to decrease? Here are the passwords of the dollar in 7 titles!
The dollar rate dropped to 7.02 lira on Friday, reaching its lowest level in the last 6 months. The Turkish lira diverged positively from other developing countries' currencies and continued to appreciate against the dollar. Clear messages given to the market by the Central Bank in line with its 5 percent inflation target strategy and the statement "We will tighten more if necessary" stood out as the biggest factor suppressing the dollar exchange rate.
Dollar rate dropped to 7.02 lira level and saw the lowest level of the last 6 months. Dollar / TL had last seen the 7.02 level on 6 August 2020.
1. FIRST SIGNAL ABOUT REVERSE DOLARIZATION COMES
According to the Central Bank's data, in the week of January 29, the foreign currency deposits of domestic residents decreased by 1.1 billion dollars to 235 billion 56 million dollars. Individuals' foreign exchange deposits fell by $ 487 million in the same week, remaining below $ 150 billion.
Foreign exchange deposits of legal entities decreased by 563 million dollars, while foreign exchange deposits decreased by 602 million dollars since the beginning of the year. In addition, foreign exchange deposits of legal entities decreased by 563 million dollars, while foreign exchange deposits decreased by 602 million dollars since the beginning of the year.
2. CENTRAL BANK TOTAL RESERVES RISE TO THE HIGHEST LEVEL OF 11 MONTHS
According to the Weekly Money and Banking Statistics report by the CBRT, on January 29, the Central Bank's gross foreign exchange reserves increased by $ 2 billion 856 million to $ 53 billion 367 million. Gross foreign exchange reserves were at the level of 50 billion 511 million dollars on 22 January. The total reserves of the Central Bank increased by 2 billion 207 million dollars compared to the previous week and rose from 93 billion 329 million dollars to 95 billion 536 million dollars. The Center's total reserves were last over $ 107 billion in the week before the pandemic, February 28, 2020.
3. MESSAGE 'WE GO MORE TIGHTENING IF NECESSARY' IS PRESSING THE DOLLAR RATE
The weak course of the dollar exchange rate strengthened in 2021 with the Central Bank's (CBRT) adoption of a tight monetary policy in line with its inflation targeting strategy and the realization of the messages 'We will tighten more if necessary' in the markets.
Central Bank (CBRT) Governor Naci Ağbal told a foreign agency, "It does not seem possible for us to put interest rate cuts on our agenda for a long time." Ağbal stated that the Central Bank is ready to take steps to prevent the market in case of upside risks in inflation expectations.
Ağbal underlined that it will be patient in achieving the 5 percent inflation target and pointed to 2023 for this level. Ağbal's statements were perceived as positive real interest rates to continue, experts stated that these statements increased downside risks for the dollar exchange rate.
4. Turkey's risk premium (CDS) CRITICAL LEVELS fell below
pandemic period, an intermediate rising 643 points to the level of Turkey's five-year credit default swap (CDS) premium was drawn to the critical 295 level fell below 300 points.