It seems that the Turkish central bank is about to receive an emergency support package from the Kingdom of Saudi Arabia, which, according to international news agencies, amounts to $5 billion.
A spokesman for the Saudi Ministry of Finance said on Tuesday that Saudi Arabia and Turkey are discussing Riyadh’s deposit of $5 billion in the Turkish Central Bank, according to Reuters.
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“We are in discussion in the final stage of depositing $5 billion in the (Turkish) Central Bank,” the spokesman said in an email response to a Reuters query.
The Turkish Central Bank declined to comment on the matter, and a well-informed Turkish official said that discussions are in their final stage with Saudi Arabia regarding a swap or deposit agreement.
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The Turkish economy is under severe pressure in light of the lira’s decline and inflation rising by more than 85 percent. A swap or deposit agreement would support Turkey’s diminishing foreign currency reserves.
Analysts indicated that this may help President Recep Tayyip Erdogan mobilize support before the elections scheduled for next June.
On the other hand, the Turkish lira is trading near its lowest level ever, near 18.7 liras per dollar, in light of officials’ insistence on moving forward with the interest-cutting policy.
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Turkey’s central bank has concluded swap deals in local currencies with several of its counterparts with a total value of $28 billion.
He signed a deal with China for $6 billion, with Qatar for $15 billion, and with the UAE for about $5 billion.
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