Turkey’s central bank has imposed new restrictions on lenders in order to limit foreign exchange purchases, claimed Şenol Babuşçu, an academic from Ankara’s Başkent University and former deputy head of Turkey’s state-run Ziraat Bank.
The central bank has put time limits on foreign exchange transactions and Turkish banks will only be allowed to purchase foreign exchange from the market until 1pm local time, said Babuşçu.
Babuşçu also claimed that the country’s monetary authority has imposed a daily limit on the total amount of foreign exchange that can be sold to customers, adding that daily limits were decided individually for each bank.
Babuşçu’s claims followed a report by Bloomberg on Monday evening which claimed that, to ease pressure on the lira, the central bank asked local lenders to limit the amount of dollar purchases made in the interbank market.
The monetary authority verbally informed some lenders last week that they had been assigned a daily limit on how much foreign currency they should buy on the interbank market after meeting their needs under the KKM program, a government-backed lira savings scheme that compensates participants for swings in the exchange rate, reported Bloomberg.
Bloomberg also noted that the Turkish central bank declined to comment on the claims.
The volatility of the Turkish lira has increased significantly ahead of 14 May elections, while lira traders expect further turbulence in coming days, according to reports.