Turkish central bank reserves fall $739 million in week as lira defended

The Turkish central bank’s gross foreign exchange reserves, excluding gold, dropped by $739 million in a week as it sought to prop up the lira.

The reserves fell to $42.42 billion in the week ending Sept. 25 from $43.159 billion seven days earlier, Dünya newspaper reported on Thursday, citing weekly figures from the bank.

The central bank has sought to defend the lira while keeping its benchmark interest rate at below inflation. It has kept borrowing cost low to encourage borrowing and to help the government achieve its goals for economic growth.

Monetary policymakers unexpectedly raised the benchmark interest rate by 200 basis points to 10.25 percent on Sept. 24. The rate compares with annual consumer price inflation of 11.8 percent.

The bank’s gross reserves have fallen from $81.2 billion at the end of last year.

The lira has dropped to successive record lows against major currencies this month as investors worried about economic instability and deposit holders sought to preserve the value of their savings.

The lira fell 0.2 percent to 7.73 per dollar on Thursday. It hit an all-time low of 7.85 per dollar earlier this week. Losses for the year total 23 percent.