MB reserves continue to rise on suspicion of ‘informal’

‘Unregistered funding’ The increase in the foreign exchange reserves of the Central Bank (MB), which caused doubts, continued last week as well. Net reserves increased by close to $4 billion, according to bankers’ accounts.

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Three bankers, whose calculations Reuters consulted, said net reserves rose by $3.5 to $4 billion last week. Total reserves increased by $4.5 to $5.5 billion, according to bankers.

In the previous week, it was stated that the total reserves of the MB increased by 7 billion 374 million dollars to 108 billion 637 million dollars.

‘Unregistered’ suspicion

According to the data of the Central Bank, in the first six months of 2022, 17.5 billion dollars of money of uncertain origin entered Turkey. Data showing money inflows and outflows of uncertain origin. ‘clear errors and omissions’ rests on his pen. This item is generally caused by measurement errors and incomplete or over-compilation of the data in the table. As a procedure, the MB has to balance the account after a while, identify the source of the foreign currency inflow and transfer it to the relevant item, but this has not been implemented for a long time; economists find this questionable.

According to an article by Economist Mahfi Eğilmez for this item, the increase in Turkey is due to unregistered foreign exchange inflows rather than deficiencies. evokes.

Evaluating this data, the former chief economist of the MB, Hakan Kara, reminded the current account deficit that reached the peak of 15 months. “There is no registered capital inflow, yet why are foreign exchange reserves not exhausted” he asked and “Because unregistered funding inflow is at its historical peak” saying had answered.

Why the reserve isn’t running out: The answer is ‘informal financing’, according to former chief economist

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