What matters this morning

The Central Bank Governor Sahap Kavcioglu laid stress on price developments, economic activity, credit growth, foreign exchange (FX) reserves and current account balance during the meeting held with investors, economists, and analysts yesterday. “The upward trend in exports, recovery in tourism and significant decrease in gold imports support ongoing improvement in external balance,” said Kavcioglu. Leading indicators point out strong economic activity in the third quarter with the impact of foreign demand, he added. The current account is expected to post a surplus in the rest of the year, according to Kavcioglu, and the annual credit growth fell to 7.4% while the near-period credit growth follows a modest path.

On the reserves side, the bank’s gross reserves continue to increase with the contribution of swap agreements in April-August, rediscount credits, required reserve steps and purchase of gold from ore. Kavcioglu also noted that improvement in external balance and FX reserves continue in line with expectations. “Our reserves nearly increased by USD 30bn to USD 115-120bn, while TRY deposits rose nearly to TRY 200bn compared to March and FX deposits recorded a limited growth at constant prices,” he added.

Whether he was able to convince the markets or not will be seen in the coming period. As of today, USD/TRY, which has started to gradually decrease from 8.67 as of August 10 and saw 8.27 yesterday, hovers around 8.28-8.30 this morning. EUR/TRY stands at 9.83-9.84. 

Gold prices at the international markets remain steady above USD 1,800 while investors await non-agricultural employment figures in the U.S. to be released tomorrow. Spot gold is traded at USD 1,814 per ounce with a slight increase.

Contrary to the yellow metal, oil prices slightly decreased after OPEC+ decided to continue to monthly produce 400,000 barrel/day until December at the meeting held yesterday. Brent crude fell by 0.2% to USD 71.45 per barrel.


Transport and Infrastructure Minister Adil Karaismailoglu will attend the collective agreement signature ceremony between the telecommunication firm Turk Telekom and the Confederation of Turkish Trade Unions (Turk-Is) (11.00 am).

Trade Minister Mehmet Mus will announce foreign trade figures for August (11.30 am).

The Central Bank and the Banking Regulation and Supervision Agency (BDDK) will release weekly money and banking statistics (2.30 pm).

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