The Central Bank of the Republic of Turkey (CBRT) announced on November 22, 2023, a series of new measures to strengthen the performance of financial markets and manage the liquidity of the Turkish lira. These decisions have been made in response to recent developments in financial markets.
Review of Liquidity Facilities
CBRT stated that following a review of its liquidity facilities, it will increase the amount of funding provided through one-week repo auctions if necessary. This action will be taken to account for market liquidity conditions. The central bank considers these changes as part of its efforts to strengthen financial markets and reduce liquidity pressures.
Revising Borrowing Limits
As part of these measures, the borrowing limits for banks in the interbank market will also be revised based on the existing balance sheets of the banking system. This action could help banks access financial resources more effectively, resulting in increased liquidity in the market.
Additionally, CBRT has announced that the collateral margins applied in central bank markets will be revised downward. This decision is designed to facilitate access to liquidity for banks and may help improve market conditions.
Continuous Monitoring of Liquidity Conditions
CBRT has also emphasized that it will continuously monitor liquidity conditions and will take additional measures if necessary. This approach reflects the central bank's commitment to effective and sustainable liquidity management in financial markets.
These measures could have significant impacts on the overall performance of Turkey's financial markets and help improve the country's economic conditions. Furthermore, these decisions are part of the central bank's efforts to maintain financial and economic stability in Turkey. In the current circumstances, where financial markets face challenges, these actions can help create confidence among investors and economic actors.
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