The Turkish central bank’s gross foreign currency reserves dropped $1.3 billion last week to $52.7 billion.
The decline took the shrinkage in hard currency to more than $11 billion in the four weeks to April 24, central bank data showed on Thursday.
Reserves of gold were little changed at around $34 billion.
Turkey’s central bank has depleted its foreign exchange reserves defending the lira as institutional investors and local deposit holders sold the currency. After a currency crisis in 2018, the impact on the economy of the coronavirus pandemic is intensifying concerns about the lira’s value, which has declined by almost 15 percent this year.
The lira dropped 0.5 percent to 6.985 per dollar on Thursday, ahead of a public holiday on Friday. Some investors and economists say the central bank, which has teamed up with state-run banks to support the lira through currency swaps, is active in the market at levels just stronger than 7 per dollar.
Central Bank Governor Murat Uysal said earlier on Thursday that it was normal for a central bank’s foreign currency reserves to shrink during global turmoil. The bank does not have a target for the lira or a specific level in mind, he said.
Turkish monetary policymakers have added to the lira’s woes by slashing interest rates to 8.75 percent in April from 24 percent last July. Consumer price inflation stands at 11.9 percent, meaning real interest rates are negative.
The central bank’s net foreign currency reserves, when excluding liabilities such as the swaps, are in negative territory. That has spooked some investors and locals.