The rate of direct investments from other countries into Turkey picked up. In addition to the direct investments, which are forecast to be much higher than the 14 billion dollars that were brought in the year before, the influx of hot money is also predicted to increase. These circumstances were also reflected in the reserves held by the Central Bank. In only one week, the MB reserves saw a growth of $2.9 billion.
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| [Central Bank of Turkiye, TCMB] |
First came the epidemic, and then came the conflict between Russia and Ukraine, both of which placed a strain on the economy of the globe. Even though there is widespread concern about economic contraction around the globe, there is a growing interest in Turkey. The amount of foreign direct investment in Turkey reached 14.5 billion dollars in 2017, representing an increase of 81 percent from 2016. Turkey has recently seen a surge in the amount of foreign cash that comes into the country. As a result, Turkey has become a stable and long-lasting supply base for all investors. This rise was reflected in the Central Bank's reserves as well as a direct result of the increase (CBRT).
When compared to the previous week, the CBRT's total reserves reached 101 billion 263 million dollars during the week of July 29. This represents a growth of 2 billion 940 million dollars from the previous week's total. As a direct consequence of this, the Central Bank's total gross foreign currency reserves reached 61 billion 101 million dollars as of the 29th of July, after having climbed by 1 billion 390 million dollars. As of the 22nd of July, the country's total gross foreign currency reserves amounted to 59 billion 711 million dollars. During the aforementioned time period, the gold reserves went from 38 billion 611 million dollars to 40 billion 163 million dollars, reflecting a gain of 1 billion 552 million dollars.
The Minister of the Treasury and Finance, Nureddin Nebati, also brought attention to the rise in the amount of money coming in from other countries during a television show he saw the day before. Nebati was quoted as saying, "Starting last week, the flow of money to Turkey picked up speed, and it will continue from this point forward." If the current trend continues, Turkey will have arrived at a very different position. If the current trend continues, Turkey will have arrived at a very different position. It is possible to eliminate the country's current account deficit via the use of direct investments, as he said. On the other hand, the weekly money and bank statistics released by the Central Bank revealed that domestic residents' deposits of foreign currency climbed by 1 billion 948 million dollars in the week that ended on July 29. This gain was calculated after taking into account the parity impact.
When corrected for the impact of parity, the amount of money kept in foreign currency by actual people declined by 193 million dollars, while the amount of money kept in foreign currency by legal companies climbed by 2 billion 141 million dollars. The rise of 1.7 billion dollars in foreign currency deposits made by legal businesses captured a lot of people's attention, particularly when expressed in dollar figures.
Following the announcement made by the Turkish Statistical Institute (TÜK) that the Consumer Price Index (CPI) had grown by 2.37 percent in the month of July and that annual inflation had increased to 79.6 percent, the Central Bank of Turkey also issued the Price Developments Report. According to the findings of the survey, annual consumer inflation was lower in the category of energy prices in the month of July, while it was higher in all other categories. The most important contributors to the rise in inflation were found in the market's fundamental products and services. In July, the contribution to annual consumer inflation rose by 1.44 percentage points for core goods, 0.75 percentage points for services, 0.45 percentage points for the alcohol, tobacco, and gold group, and 0.32 percentage points for food; however, it fell by 1.98 percentage points for energy.
Source: Yeni Safak