Nureddin Nebati shared some insights regarding the Turkish Government’s new program involving the Turkish lira. The Minister of Treasury and Finance of the Republic of Turkey affirmed that people in Turkey had been demonstrating a robust interest in the recently-introduced scheme.
We are interested in reading this latest foreign exchange-related report about the Turkish lira and sharing it with our readers. We understand that Turkey has been subjected to soaring inflation and a currency devaluation spiral lately.
We want to help our readers holding units of the official Turkish currency know the new developments that can affect them by sharing this news. Based on the report posted online by Turkish daily newspaper Hürriyet Daily News, Nebati gave insights regarding the new devaluation-protected savings product.
This new scheme was jointly introduced last December 21, 2021 by the Central Bank of the Republic of Turkey and the Ministry of Treasury and Finance of Turkey. Additionally, the product is designed to safeguard the Turkish lira time deposit accounts against any losses caused by foreign exchange fluctuations.
Nebati was present at a convention with members of non-governmental organizations in Istanbul last Saturday, January 15. During that meeting, he said that some 10 billion Turkish liras had been placed into those foreign exchange-protected deposit accounts each day since the new program’s inception.
The Treasury and Finance Minister cited that Turkish citizens had been exhibiting a strong interest in the new scheme. Hürriyet Daily News reported that more than 131 billion Turkish liras had been put into the foreign exchange-protected deposit accounts since the scheme’s launch late last year.
This government program halts decline and protects deposits denominated in the local currency from foreign exchange depreciation. Nebati remarked that the Turkish lira facility had enticed 126 billion Turkish liras or US$9.3 billion, of which 15 percent came from foreign currency accounts.
He affirmed that about 300,000 people are participating in the government scheme. Furthermore, Nebati stated that work on increasing the state banks’ capital would be completed before this month’s end.
The Turkish lira held firm last Friday, January 14, following Nebati’s statement about inflation peaking this month and hitting single digits by the June 2023 elections. The official currency of the Republic of Turkey gained 0.3 percent to 13.58 Turkish liras to the US dollar at that time.
We gathered that the Turkish lira weakened 44 percent last year with a currency crisis that the Turkish Government halted last month. The latter engaged in currency interventions and introduced a scheme to protect the Turkish official currency from foreign exchange depreciation.
We learned that this economic dilemma that started late last year was sparked by the Central Bank of the Republic of Turkey’s 500 basis points of interest rate cuts to 14 percent since September.
We feel relieved to learn about the new government scheme because it shows that the Turkish authorities are performing key measures to address the country’s currency crisis and effectively help their citizens.