Turks are piling into bank accounts that guarantee lira savings against currency depreciation at the fastest rate in a year ahead of next month’s elections.
(Bloomberg) — Turks are piling into bank accounts that guarantee lira savings against currency depreciation at the fastest rate in a year ahead of next month’s elections.
Net inflows into so-called FX-protected deposit accounts rose 4.45% to 75.8 billion liras ($3.9 billion) in the week ended April 7, data from the banking regulator showed on Thursday. That’s the second-highest inflow since the regulator started publishing the data in February 2022.
The surge came after Turkey’s central bank relaxed rules on the maturities and interest rates that lenders can offer on the accounts, making them more attractive to savers, especially ahead of the tightly fought May 14 vote that could upend economic policy no matter who wins.
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The accounts are one of the government’s main tools in its campaign to support the lira by reducing demand for foreign currency.
Turkey’s lira is down 0.6% against the dollar this week, its sixth week of losses and the longest falling streak since January.
Market Metrics:
- USD/TRY -0.2% at 19.3755 as of 9:55am in Istanbul
- 10-year benchmark lira bond yield -67bps to 12.3%
- 5-year CDS -2bps to 531bps
- Borsa Istanbul 100 Index +0.2% to 5,143 points
- US Treasury 10-year bond yield little changed at 3.45%
- Brent crude +0.3% to $86.36 per barrel
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