Goldman Sachs Analysis on CBRT Reserves and Current Account Balance
Goldman Sachs stated that CBRT reserves melted by $30 billion over the past year, drawing attention to the financing risks of the current account deficit.
US-based investment bank Goldman Sachs published its analysis on Turkey's August current account balance data, reporting that CBRT reserves saw a $30 billion melting over the last 12 months, which indicates insufficiency in financing the current account deficit.
Current Account Balance and August Data
According to data from the Central Bank of the Republic of Turkey, the current account balance posted a surplus of $4.053 billion in August.
While this announced indicator pointed to the highest current account surplus of the past year, the net errors and omissions item was recorded at $4.52 billion.
Decline in CBRT Reserves
The total reserves of the CBRT decreased by $3 billion 816 million in the week of October 2 compared to the previous week, dropping to $167 billion 388 million.
The total decline in reserves, which have been falling uninterruptedly for six weeks, reached $21.1 billion, descending to the lowest level of the last two months.
Details of the Goldman Sachs Report
According to Goldman Sachs' analysis, the $30 billion drop seen in CBRT reserves over the past 12 months demonstrates inadequacy in financing the current account deficit.
The report stated that the financial account recorded an outflow of $1.4 billion due to net portfolio outflows, while the net errors and omissions item registered an inflow of $4.5 billion.
Factors Affecting the Current Account Balance
It was stated that the decline in core goods imports and the seasonal increase in tourism revenues were effective in the improvement experienced in the current account balance.
According to the bank's assessment, the annual decline in the number of tourists could exert pressure on Turkey's current account balance, particularly as of 2027.
Year-End Current Account Deficit Expectations
Goldman Sachs projects that Turkey's current account deficit will correspond to 2.9 percent of gross domestic product by the end of the year and reach approximately $50 billion.
The report emphasized that although the ratio of the current account deficit to national income remains below historical averages, the total amount retains its importance regarding external financing needs.