Turkish central bank triples Qatar currency support deal to $15 billion

  • أردوغان يحكم قطر بعدما فرض حمايته على تميم المذعور

Funding markets have deteriorated in Turkey, with the lira hitting its lowest point ever just this month amid investor concerns over the country’s finances, according to CNBC. The move amended the original limit of $5 billion on the two countries’ initial swap agreement in 2018, raising it to $15 billion. Still, “it’s unclear whether the Turkey-Qatar currency swap deal will have tangible effects on the Turkish economy,” one forecasting expert told CNBC.  Turkey’s central bank tripled its currency swap agreement with Qatar on Wednesday, securing much-needed funding as the country of 82 million burns through its reserves and faces a widening fiscal deficit and potential full-year recession. The move amended the original limit of $5 billion on the two countries’ initial swap agreement in 2018, raising it to $15 billion. The Turkish central bank has drawn down millions of dollars from its foreign currency reserves in recent months to buy lira and prop it up against the dollar. The expanded swap line with Qatar — which in recent years has strengthened its political and economic relationship with Ankara — enables Turkey’s central bank to provide its domestic banks with the foreign liquidity they need without using its own foreign reserves.  “Turkey is desperate for access to U.S. dollar swap lines, which the U.S. Fed continues to hold off on. The swap deal is relevant only for trade with Qatar, which remains limited.” says Agathe Demarais, global forecasting director at the Economist Intelligence Unit.

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