Dialogos

Turkish Lira Reserves Hit by Middle East Conflict

Published March 24, 2026, 14:04
Turkish Lira Reserves Hit by Middle East Conflict

The war in the Middle East is putting significant pressure on Turkey's foreign exchange reserves. According to data from the Central Bank of Turkey, net international reserves fell by $22.8 billion in the first two weeks of the war, falling below $70 billion. This decline is due to increased market volatility following the attacks by the US and Israel on Iran. The Central Bank of Turkey intervened extensively, selling $23.5 billion worth of foreign exchange in two weeks. The largest sale occurred in the first few days of the conflict, with $13 billion sold in the first week and additional outflows the following week, including an intervention of $8 billion. These figures reveal the immediate economic cost of geopolitical tensions for the Turkish economy. The Central Bank attempted to contain pressures in the foreign exchange market, dealing with increased volatility and capital outflows. The significant decline in foreign exchange reserves highlights the vulnerability of the Turkish economy to external shocks and the need for stabilization and risk management. The situation requires careful monitoring and possible additional interventions to protect the Turkish lira and ensure economic stability.