Weekly Financial Developments – September 19: CBRT rebuilds FX reserves

Reserve Position and Balance Sheet Signals

In the week of September 19, a USD 1.3 billion increase in net reserves excluding swaps (USD 0.9 billion increase adjusted for gold prices), a USD 408 million purchase of equities by nonresidents, and a USD 1.2 billion increase in FX deposits stood out. Additionally, according to the CBRT’s Analytical Balance Sheet, as of September 24 (covering the first three business days of the week), we estimate an increase of approximately USD 3.4 billion in net reserves excluding swaps.

FX Deposits and KKM Trends

• Parity-adjusted FX deposits rose by USD 1.2 billion, with individuals recording USD 76 million in sales and corporates USD 1.3 billion in purchases.

• Since the beginning of the year, FX deposits have increased by USD 17.5 billion.

• FX-protected deposit (KKM) balances decreased by TRY 24.1 billion (USD 0.6 billion) on a weekly basis, falling to TRY 321 billion.

• The cumulative unwinding from the August 2023 peak has exceeded TRY 3 trillion (USD 129 billion).

• The share of FX deposits + KKM in total deposits stood at 39.9%, compared with 68.4% at the August 2023 peak.

TRY Deposits and Loan Dynamics

• TRY deposits increased by TRY 99 billion over the week, rising to around TRY 15.2 trillion.

• FX loans rose by USD 0.5 billion; since end-March 2024, they have climbed 44.3% (USD 59.9 billion) to reach USD 194.6 billion.

• Annualized 13-week average loan growth slowed: commercial loans from 21.2% to 20.4%, and consumer loans from 41.6% to 40.5%.

Non-Resident Flows: GDDS, Equities, and Eurobonds

• In the week ending September 19, non-residents recorded a net purchase of USD 178 million in GDDS, bringing stock to USD 15.2 billion.

• Between mid-March and April, GDDS saw outflows of USD 9.3 billion; since May, inflows have exceeded USD 5 billion.

• In equities, net purchases reached USD 408 million, raising stock to USD 33.7 billion and reversing three weeks of net sales (USD 828 million total).

• Eurobonds saw a net purchase of USD 1.8 billion, lifting stock to USD 80.9 billion.

International Reserves and Gold Valuation Effects

• Gross reserves rose from USD 177.9 billion to USD 178.9 billion (+USD 1 billion).

• Net reserves increased from USD 69.6 billion to USD 70.4 billion (+USD 0.8 billion).

• Net reserves excluding swaps climbed by USD 1.3 billion to USD 53.1 billion.

• Gold prices generated a positive valuation effect of USD 0.4 billion; excluding this, net reserves ex-swaps increased by USD 0.9 billion.

• Historical reference: net reserves ex-swaps bottomed at USD -65.5 billion (March 2024), peaked at USD 71 billion (February 14, 2025).

Early Data for September 24

Based on the CBRT’s Analytical Balance Sheet (first three days of the week):

• Gross reserves up USD 4.4 billion.

• Net reserves up USD 2.7 billion.

• Net reserves ex-swaps up USD 3.4 billion.

• Gold-price effect during the period: +USD 2 billion.

• Cumulative positive gold-price contribution to reserves over past five weeks: USD 10.5 billion.

Mutual Funds and Dollarization Trends

• The Money Market Fund (MMF) size declined by TRY 6 billion, falling below TRY 1.2 trillion.

• Under the Free Umbrella Fund, MMFs rose by TRY 76 billion to around TRY 1.15 trillion.

• FX-denominated mutual funds increased by USD 1.5 billion to USD 69.5 billion (USD 25 billion at start-2024).

• Including investment funds, the dollarization ratio edged down from 42.4% to 42.3% (vs. 59% at start-2024).

By Gedik Invest