The Turkish Central Bank’s total reserves rose by $944 million to hit $120.1 billion last week, for the first time since November 2016.

According to weekly money and bank statistics published by the bank, the gross foreign exchange reserves increased by $1.6 billion to $79.6 billion on Sept. 10, from $78.5 billion on Sept. 3.

The reserve increase was largely driven by swap agreements, reserve requirement arrangements, IMF funding, rediscount returns, and gold from ore.

Meanwhile, gold reserves decreased by $670 million to $40.5 billion in the said period, from $41.1 billion on Sept. 3.

On Wednesday, the bank raised reserve requirement ratios for foreign currency and precious metal deposit accounts.

Announcing the move in the Official Gazette, it increased the ratio by 200 basis points for all such accounts.

Following the decision, the ratio reached 23% for foreign currency deposit accounts – demand, notice and up to one-year maturity – and 17% for foreign currency accounts with a maturity of one year or more.

Last month, Turkey's President Recep Tayyip Erdogan said the Turkish Central Bank's reserves would surpass $115 billion when pending transactions were completed.

There are two items that will increase the bank's gross reserves in the coming period.

With the bank's latest required reserve regulation, the amount of foreign currency held by banks in the Central Bank is expected to increase by $3.4 billion to over $65 billion.

In addition, the swap agreement with South Korea more than a month ago has not yet entered the accounts.

With these two developments, the total reserve is expected to reach $125.5 billion./aa