Lira may face modest pressure, but Turkish economy stable: VP

Türkiye’s Vice President Cevdet Yilmaz said Tuesday that the Turkish economy remains resilient despite recent market volatility, adding that the impact is expected to be limited and temporary, with only a “slight uptick in foreign currencies” against the lira.

Speaking during a live broadcast, Yilmaz answered journalists’ questions on current developments, highlighting positive trends in key economic indicators. He emphasized that figures related to the budget deficit, current account balance, reserves, and employment remain in healthy condition.

“When we look at all the indicators, we see improvement across the board,” Yilmaz said. “Our current account deficit is at historically low levels, and the budget deficit is under control at around 5%.”

‘Lasted three days—don’t expect an exaggerated impact’

Yilmaz also sought to ease concerns over the Turkish central bank’s reserves, underlining that the bank has accumulated a substantial amount—sufficient to withstand external shocks.

Last week, the central bank intervened in the foreign exchange markets by selling U.S. dollars to meet rising demand and stabilize the lira. The move is estimated to have cost up to $25 billion between March 19 and March 21.

Addressing these reports, Yilmaz acknowledged “a fair amount” of decline in the central bank’s reserves but added that downturns and volatility are also affecting the Istanbul Stock Exchange.

“Our Central Bank, Capital Markets Board, and other relevant institutions have taken proactive measures, and they were absolutely right to do so,” Yilmaz commented.

“Of course, this period will have some impact, but calculating the cost of a three-day event over an entire year is not appropriate. I don’t expect an exaggerated effect.”