According to official data released by the Turkish Statistical Institute (TURKSTAT), the Turkish consumer confidence index increased by 4.1% to reach 91.1 points in May. This upward trend continues as the country prepares for the upcoming presidential election runoff later this month. The latest increase follows a dip to 80.1 points back in March.
A confidence level below 100 reflects a pessimistic outlook for the future, while a reading above 100 indicates optimism, according to Reuters.
Read more: Turkey’s presidential runoff sparks economic avalanche in the country
Bankers have mentioned that Turkish banks have reduced loans to individuals and postponed lending decisions for companies following new regulations imposed by the Central Bank in the wake of inconclusive presidential elections on Sunday 14 May, and before the runoff on May 28th.
According to sources, some banks have raised the interest rate on monthly mortgage loans above 3%, while the interest rate on car loans has reached 4%.
The bankers added that the monthly interest rates on personal loans exceeding 70,000 liras (equivalent to $3,590) have approached 5% since the new regulations were imposed.
Turkey’s foreign currency and gold reserves dropped by $17 billion in the six weeks leading up to the recent general election. This was due to the government’s efforts to boost the economy and support the lira in the run-up to the closely contested election, a recent report by the Financial Times found.
The data showed that the Central Bank‘s foreign currency reserves decreased by $9.5 billion between March and May 12, while its gold holdings fell by $7.9 billion. This represents a 15 percent decline in both categories.
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