For 1st time since 2007, Turkish central bank holds $1.31B liquidity bill auction

Central Bank of the Republic of Türkiye (CBRT) launched its first liquidity bill tender since 2007, offering ₺50 billion ($1.31 billion) in one-month securities as part of its open market operations.

The bank announced that the tender will be held on Tuesday, and bids will be accepted between 11 a.m. and 11:45 a.m. local time. Participation in liquidity bill auctions is limited to banks and intermediary institutions that have signed a framework agreement with the central bank.

Liquidity bills are short-term debt securities issued by the central bank with the primary goal of managing the money supply and enhancing the efficiency of open market operations.

These instruments are issued at a discount and have maturities not exceeding 91 days. They are offered in the bank’s own name and for its own account and serve as a tool to fine-tune short-term liquidity conditions in the financial system.

The move follows a statement issued by the central bank on March 21, amid ongoing political tensions that have triggered a market downturn in Türkiye, weakening the Turkish lira and driving up demand for foreign currency.

In that statement, the CBRT announced its decision to resume issuing liquidity bills with maturities of up to 91 days.

By reintroducing this monetary policy tool, the central bank aims to absorb the excess Turkish lira liquidity circulating in the financial system—liquidity that has increased due to the bank’s foreign currency purchases.