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The Central Bank of the Republic of Türkiye’s international gross reserves fell by $12.2 billion to $177.45 billion in the week ending March 20, largely driven by a drop in gold reserves, which declined by more than 10% over the period amid the Iran war, figures showed.
While gross foreign currency reserves increased by $5.8 billion to $61.3 billion, gold reserves dropped sharply by $18 billion to $116.2 billion.
The Turkish central bank was among the leading gold buyers in 2025, adding 27 tons to its holdings and bringing total reserves to 677 tons, according to the World Gold Council. Gold accounts for more than 50% of the bank’s reserves.
The decline extended to key liquidity indicators, with net reserves falling from $69 billion to $57.4 billion over the same period. Excluding swaps, net reserves fell further, declining from $54.3 billion to $43 billion. Thus, the total loss since the start of the conflict reached $32.8 billion in gross reserves and $35.8 billion in swap-excluded net reserves.
Earlier this week, Bloomberg reported that Turkish policymakers are preparing to use gold reserves in gold-for-foreign-currency swap transactions in the London market to boost U.S. dollar reserves and support operations aimed at stabilizing the Turkish lira by supplying dollars to the market.
Meanwhile, foreign investors extended their selling streak that began after the war, offloading $137.6 million in equities and $130.1 million in government domestic debt securities during the same week. This brought total outflows from Turkish bonds to more than $4.7 billion, while equity outflows reached $1.2 billion over the three-week period.
The size of carry trade positions, which reached a record $61.2 billion in January and has declined steadily since early March, is continuing to shrink. In the week of March 19, outflows in carry trade transactions amounted to $2.8 billion, pushing the total size below $45 billion. Over the past three weeks, total outflows reached $14.7 billion, marking the largest recent withdrawal from carry trade positions.
Banking sector data indicated tighter conditions, with total deposits falling by ₺171.3 billion to ₺29.4 trillion ($662.7 billion), while foreign currency deposits totaled $269.2 billion. Meanwhile, consumer loans extended to domestic residents declined by 1.4% to ₺5.9 trillion.
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