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Turkey to use Central Bank's 2018 profit to boost cash buffers

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The amount to be transferred to the Treasury is estimated at around TRL 37 billion ($6.7 billion), nearly double the Government’s forecast for the year.

Wednesday 09, January 2019

(Bloomberg) --The Turkish central bank’s bigger-than-expected profit in 2018 will be used to boost the government’s cash buffers and improve the flow of liquidity to businesses, Treasury and Finance Minister Berat Albayrak said Wednesday.

The Treasury typically collects its share of the central bank profits in the form of various transfers and taxes in April. But the regulator’s extraordinary board meeting will be held earlier than usual this year and will allow the government to use some of the cash to improve “liquidity flow” to markets, Albayrak said.

The decision comes at a time when policy makers are trying to rein in public spending. Albayrak is striving for a primary budget surplus of about 0.8 per cent of gross domestic product this year, up from an estimated 0.1 per cent in 2018.

The lira was trading 0.2 per cent lower at 5.50 per dollar at 12:29 p.m. in Istanbul. It has lost almost four per cent against the US currency so far this year, the worst performance among 24 emerging-market currencies tracked by Bloomberg.



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