Turkey’s central bank sold a record amount of foreign currency on Wednesday after the lira dropped more than 12% following the detention of Istanbul’s mayor, according to calculations by three bankers.
Bankers say at least nearly $10 billion in foreign currency was sold by the central bank on Wednesday.
The Turkish central bank declined to comment.
The bankers said that the central bank did not directly intervene in the exchange rate but that the transactions it carried out through existing foreign exchange buying and selling methods via public banks indicated a record level of foreign exchange sales.
The central bank carries out FX transactions through many channels such as purchases from exporters and FX-protected scheme payments. These purchase and sale transactions have contributed more than $140 billion in reserves in the last 1.5 years.
Source: Reuters (Writing by Ezgi Erkoyun; Editing by Hugh Lawson)