Bank intervenes big in market

ISTANBUL - Hürriyet Daily News

The Turkish Central Bank, governed by Erdem Başçı, sold about $1.5 billion on Dec 30 directly, according to some traders. DAILY NEWS photo, Selahattin SÖNMEZ

Turkey’s Central Bank directly intervened in the currency market on Dec. 30, in addition to a $750 million sale in a daily auction which collected $920 million of bids.
Central Bank intervention came after the local currency’s depreciation against the green back broke all time records two days in a row as the Turkish Lira traded at more than 1.90 per dollar. 
Traders estimated the Bank’s intervention was as much as $1.5 billion, Anatolia news agency reported Dec. 30.
The total volume of $2.25 billion was sold as of 5p.m. Dec. 30 when $750 million was added to the estimated amount of direct intervention.
The interventions will continue when necessary, the Central Bank said on its official website. 
The lira surged as much as 3.1 percent to 1.8575 per dollar, the biggest increase since March 2009 and gained 2 percent to 1.8786 at 5:13 p.m., according to Bloomberg News. 
“As an unhealthy price formation in currency exchange markets has been observed, the bank intervenes in the exchange rate through the sale,” said the Central Bank in a later statement, state-run TRT television reported. 
Meanwhile, Ali Babacan, Deputy Prime Minister and the head of Economy Coordination Board, proposed İbrahim Turhan, the Central Bank’s vice President, to be the new head of Istanbul Stock Exchange (İMKBE). 
The bylaw, regarding the assignment, was sent to the President Abdullah Gül for ratification, Anatolia news agency reported.