Turkish Financial and Capital Markets

From International Business Wiki

Central Bank of the Republic of Turkey

The Central Bank of the Republic of Turkey was instituted on October 3, 1931, and opened its doors on January 1, 1932. Before this time there was no official centralized bank for the country of Turkey. The Ottoman Bank was the “unofficial” centralized bank before this time. The centralized bank was established to maintain Turkey’s currency exchange rates against other foreign currencies, regulate money markets, and set ratios for discounts. The bank also is in charge of issuing banknotes, setting the inflation rates, and issuance of loans to other banks. The Central Bank of the Republic of Turkey has several offices throughout the world. The main location of the bank and offices is in Ankara, Turkey. Other offices are located in New York, United States, London, England, Frankfurt, Germany, Tokyo, Japan, and Berlin, Germany. One of the main responsibilities of the Bank of the Republic of Turkey is to set the currency exchange rates. The Turkish Lira is usually set against the price of the US dollar or the euro. The rate of exchange is driven by the supply and demand of the Lira. Auctions are held yearly to keep their coffers up. These auctions can be held more frequently if the need arises. There is a maximum daily limit for the auction purchases. These amounts total $60 million. This would include $20 million for the purchasing of currencies, and the remainder for the selling of currencies. The Central Bank must also publish several reports within a year’s time. The Inflation Report is issued quarterly. In 2007 the release dates for these reports were January 29, April 27, July 27, and October 26. The Financial Stability Report is distributed twice a year, on May 31, 2007 and November 30, 2007. There is also a Summary of the Monetary Policy Committee Discussions that must be made public within 8 business days of the committee meeting. Also when the bank issues a statement made about inflation within 2 days they must publish a “Price Developments” Report. All of these reports can be reviewed on the Central Bank of the Republic of Turkey’s website.

All information provided above was found on the Central Bank of the Republic of Turkey’s website http://www.tcmb.gov.tr/yeni/eng/index.html