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The Turkish central bank has announced the termination of new openings and renewals for currency-protected deposit (CPD) accounts, with the decision published in the Official Gazette.
The central bank of Türkiye has announced that new currency-protected deposit accounts can no longer be opened and existing ones will not be renewed.
In a notice published in the Official Gazette, the bank said the decision takes effect on Aug. 23, except for YUVAM accounts. Accounts already in place will remain active until they reach maturity, after which they will be closed.
The central bank added that the policy goal of rolling over CPD accounts into Turkish lira has now been scrapped, and rules on reserves, interest, and commissions have been adjusted accordingly.
Introduced in late 2021 under then-Finance Minister Nurettin Nebati, the program was designed to shield savers from sharp lira depreciation. At its peak, CPD balances reached $140 billion. But authorities, pivoting back to orthodox economic policies after the May 2023 elections, began gradually winding it down.
The stock of CPD deposits has since plunged to about ₺478 billion ($11.8 billion), down from ₺3.4 trillion in August 2023, now making up just 2% of total deposits compared to more than a quarter last year. Treasury and Finance Minister Mehmet Simsek said this week the steady decline was driven by the government’s exit strategy and tight monetary policy.
The lira has stabilized somewhat during the transition. After losing 44% of its value in 2021, 29% in 2022, and 37% in 2023, it has fallen a more modest 13% so far this year. Inflation has also eased to 33.5% from a peak of 75%, allowing the central bank to begin cutting interest rates again.
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