Durmuş Yilmaz: Turkey's monetary and exchange rate policy for 2008
Speech by Mr Durmuş Yilmaz, Governor of the Central Bank of the Republic of Turkey, at
the Central Bank of the Republic of Turkey, Ankara, 18 December 2007.
* * *
General framework of the monetary policy
Overview of 2007
The Central Bank of the Republic of Turkey (the Central Bank) has continued to implement
the monetary policy in 2007 based on the principles of inflation targeting regime. The
Monetary Policy Committee (the Committee) meetings were held in line with the
preannounced annual timetable. Interest rate decisions were made public through press
releases on the same day along with the rationale of decisions. Moreover, "Summary of the
Monetary Policy Committee Meeting" including details of decisions and the assessments
made during the meetings started to be published along with the English translation within
eight working days following the meetings in 2007. Inflation Report, which is the main
communication tool of the Central Bank, continued to be published quarterly. Furthermore, in
order to increase the efficiency in management of expectations, Price Developments Report
was also published within a very short time with a detailed analysis of inflation data following
the announcement of monthly price developments.
Inflation in the first quarter of 2007, as foreseen, remained within the uncertainty band set
around the path consistent with the target, whereas the decline in inflation stagnated in the
last quarter due to both considerable increases in food prices, arising from drought as well as
global conjuncture, and adjustments in administered prices. Thus, it has become obvious
that the year-end inflation would remain outside the uncertainty band. Though the Central
Bank has targeted the CPI inflation, it has pursued an effective communication strategy by
referring to core measures at times of price movements beyond its control and pursued an
effective communication strategy. In line with the positive outlook of inflation trend in prices
excluding energy, food and administered prices, a measured rate cut cycle has been initiated
in September 2007. Accordingly, the overnight borrowing rate was decreased by 175 basis
points in total until the end of 2007, from 17.50 percent to 15.75 percent.
The Central Bank has made significant progress over the last two years in terms of
communication policy, transparency and accountability. Despite the fact that inflation
remained above the path consistent with the target due to a series of supply-side shocks
over the past two years, the inflation expectations for the next 12 and 24 months indicate low
levels such as 6.1 and 5.2 percent, which have not been experienced for many years in our
economy. This shows that inflation targeting regime has highly succeeded in managing
expectations. In the meantime, as the inflation expectations indicate figures above the
medium-term target of 4 percent points, we think that there are many things to do towards
disinflation. The Central Bank, not being content with what has been achieved so far, will
continue to further increase the efficiency in expectations management in forthcoming
periods.
The rest of this text provides the general framework of the monetary and exchange rate
policy to be implemented in 2008. The first part addresses the strategic framework of the
monetary policy, while the second part explains the exchange rate policy, foreign exchange
auctions and guidelines for liquidity management.
Inflation targets
Inflation targets have been set as "point target" since 2006. The target has been defined as
the end-year Consumer Price Index (CPI) inflation calculated by the annual percentage
change of the Consumer Price Index (CPI) and the target horizon, has been set as 3 years in
line with 3-year budget implementation. The Central Bank continues this practice in 2008 as
well.
By considering the structural transformation of the economy, convergence process to the
developed countries and the pricing behavior that remained from high inflationary period, a
target of 4 percent has been considered appropriate for the medium-term as agreed with the
government. Therefore, inflation targets for 2008 and 2009, which were previously
announced as 4 percent, are maintained and the inflation target for 2010 has also been set
as 4 percent.
The importance of Special CPI aggregates
Due to its comprehensive context coming from its definition, consumer price index can be
exposed to temporary fluctuations. Core indicators allow for differencing out the price
movements in items unaffected by monetary policy actions, and thus enable much better
analysis of the main inflation trend. For instance, the impact of a significant increase in
energy prices on consumer prices can be analyzed by using a price index excluding energy
prices. Similarly, a temporary price increase arising from one-time movement in special
consumption tax levied on tobacco products can also be identified by using special CPI
aggregates excluding the item in consideration.
A series of supply-side shocks that have occurred over the last 2 years have underlined the
importance of special CPI aggregates. The relevant indicators, which may also be called as
"core" indices, have played an important role in the communication of monetary policy
decisions in 2007.
Undoubtedly, it is not possible to define a single core indicator for inflation that can disregard
all temporary effects observed in consumer prices. For instance, the Special CPI Aggregates
issued by the Turkish Statistical Institute does not exclude food group. As we
processed
have experienced recently, the drought has a negative impact on core measures via
processed food prices. In other words, although the main inflation trend has not worsened,
the growth rate of special CPI aggregates can display increases stemming from processed
food prices. Accordingly, the Central Bank has established an index excluding all food items
and started to monitor this index closely.
From time to time, the Central Bank draws the attention to price movements in certain
subgroups of the CPI in order to increase efficiency of the communication of the monetary policy
and to take sound decisions. For instance, in order to highlight the effects of the monetary
policy tightening being implemented since mid-2006, the Central Bank has frequently
referred in 2007 to the developments observed in sub-groups, such as services or durable
consumption goods, whose prices are sensitive to monetary policy actions.
In summary, the Central Bank examines several variables including Special CPI Aggregates
while assessing the main inflation trend, and can highlight different indicators at certain
periods depending on the economic conjuncture. Understanding of the Central Bank's
approach to core inflation by the public will allow for a sound assessment of the monetary
policy actions and hence an improved efficiency of communication policies.
Uncertainty band and accountability
It is stipulated in Article 42 of the CBRT Law that "The Bank shall submit information to the
Government in writing and inform the public disclosing the reasons of the incapability of
achieving the determined targets in due time announced or the occurrence of the possibility
of not achieving the targets and the measures to be taken thereof". While, it forms a basis for
the accountability principle, the law does not specify the size of the deviation from the target
that will require such an explanation. In other words, details of accountability mechanism are
left to the Central Bank's own initiative. Therefore, the Central Bank has established an
effective and enforceable accountability mechanism by setting a symmetrical uncertainty
band of 2 percentage points in both directions around the point target.
As stated above, the inflation target has been defined over a very comprehensive CPI index.
The CPI index also comprises of price items that are beyond the control of the monetary
policy such as food, energy and administered goods. In emerging markets like Turkey,
shortterm fluctuations in exchange rates can lead to unpredictable temporary fluctuations in
inflation as well. Since a sudden reaction of monetary policy to factors that are beyond its
control will increase volatility in macroeconomic variables, inflation-targeting central banks
adopt a medium-term approach and allow temporary fluctuations in inflation as long as the
expectations are under control. In this framework, the primary objective of setting an
uncertainty band is to establish a measurable criterion that will enable to determine to what
extent the deviations from the point target will be tolerated with respect to the accountability
principle.
In view of the above-mentioned factors, it has been decided to keep the uncertainty band at
2 percent for 2008 as well. In this context, the path consistent with the end-year target and
the uncertainty bands defined for the end of each quarter of 2008 are given in Table 1.
Table 1: Inflation path consistent with the end-year target and the uncertainty band
March June September December
Uncertainty Band (upper limit) 9.10 8.50 8.30 6.00
Path Consistent with the
Target 7.10 6.50 6.30 4.00
Uncertainty Band (Lower Limit) 5.10 4.50 4.30 2.00
In case of realizations of the end-of-quarter figures outside the band, the Central Bank shall
submit an to the Government disclosing the reasons of the deviation and the
open letter
measures already taken and to be taken for convergence to the target, and share this letter
with the public.
Recently, the Overview chapter of the Inflation Report has been restructured in line with
accountability principle. Accordingly, the Central Bank has started using Inflation Report to
share its view pertaining to inflation and monetary policy outlook and the necessary
measures to be taken to keep inflation close to the target. Thus, besides being the main
communication tool of the Bank, the Inflation Report has therefore assumed an important
role with respect to accountability principle as well. Accordingly, there will be more
references given to the Inflation Reports in the case of possible open letters in forthcoming
periods. It is necessary for the communication policy of the Central Bank that the open letters
and Inflation Report would be perceived as complementary factors.
Role of public sector in inflation targeting strategy
It should be reemphasized that the monetary policy should be supported by fiscal policy in
order to be able to turn the downward trend in inflation into a long-term and lasting
achievement. The fiscal policy can affect inflation through various channels. A particular
channel, through which fiscal policy has direct effects on inflation, is the price and tax
adjustments in the goods and services produced by the public sector. Making these
adjustments in line with a pre-announced schedule or a pre-described rule would diminish
uncertainties regarding inflation forecasts and thereby contribute to the reputation of inflation
targeting regime.
The Central Bank sets inflation targets on the basis of the budget projections of public sector.
Therefore, while updating the monetary policy stance, the trend of public sector
expenditures, which is a very important component of total demand, is closely monitored.
Moreover, keeping public sector wage adjustments consistent with the inflation target is very
important as the private sector take these adjustments as a benchmark for their own wage
adjustments.
Due to all these reasons mentioned above, the Central Bank closely monitors the income
and fiscal policy implementations, and frequently emphasizes the importance of structural
reforms that would enhance the quality of fiscal discipline and predictability of fiscal policies.
Transmission mechanism, inflation forecasts and monetary policy stance
Uncertainties regarding the impact of monetary policy implementations on inflation are an
issue that central banks frequently underline in their monetary policy statements. In countries
that are undergoing a structural transformation process like Turkey, the relationship between
macroeconomic variables evolve over time, leading to a higher degree of uncertainty
pertaining to monetary transmission mechanism compared to developed countries.
Moreover, it is believed that Central Bank's sharing of its evaluations about the transmission
mechanism would contribute to the expectations management.
The fact that the short-term interest rates have only shown a declining pattern for a long time
with the disinflation process after 2001 and this trend coincided with transition to inflation
targeting regime made it difficult to evaluate the transmission mechanism. Nevertheless, the
monetary tightening, which have been made since the mid-2006 and the macroeconomic
dynamics thereby, allow for important inferences regarding to the workings of the
transmission mechanism. Upon the recent evaluations, it can be suggested that the effect of
monetary policy tightening has lasted for one year on economic activity and for two years on
inflation. The effect of monetary policy on private sector demand and inflation has become
more evident in the last one-and-a-half years. Moreover, it has been affirmed that monetary
policy can indeed control expectations. The sectors on which the monetary policy has been
most influential have been consumer durables group and services sector. In fact, price
dynamics of services and consumer durables sectors have contributed to disinflation process
significantly.
To sum up, despite the fact that nearly half of the CPI is composed of energy, food, and
administered goods prices, it is evident that monetary policy is still capable of keeping the
main inflation trend under control via other items.
As stated also in the last two years' monetary policy statements, the inflation target would be
changed only if from the target occur due to factors beyond
sharp and long-term deviations
the control of the monetary policy such that the medium-term targets no longer make sense.
Within this framework, while considering the possibility that inflation might be exceeding the
target for a while in the short run, the Central Bank maintains the 4 percent inflation target
hinging on the evaluation that the general trend of inflation is downwards.
The forecasts presented in the Inflation Reports will continue to refer to two-year periods. In
phases when inflation is above the target, the forecasts presented in the Inflation Report
become more important. The forecasts inform the public about the path that inflation will
follow while moving towards the medium term target. In other words, the reference value
established for economic units is the inflation forecast in the short-run and the inflation target
in the long-run.
Another message that inflation forecasts contain is the monetary policy stance. The answer
sought while forming forecasts and monetary policy outlook in the Inflation Report is: "What
is the monetary policy stance that will keep inflation close to the target in the medium-term?"
The in this sense does not only consist of the current level of
monetary policy stance
shortterm interest rates. Monetary policy stance indicates the prospective path that short-term
interest rates will follow in a period that extends from today to medium term. Sharing with the
public the interest rate assumptions that form the basis of forecasts, though qualitatively, is a
remarkable step towards enhancing the transparency and predictability principles that are
essential for inflation targeting.
Communicating with the public about the possible Central Bank policies influences
mediumterm market interest rates via expectations and strengthens the transmission mechanism.
However, it should be reminded once again that the monetary policy stance path pronounced
in the Inflation Report is produced according to currently available information and that each
new data release related to the medium-term inflation outlook would necessitate the revision
of the future monetary policy stance. Under the inflation-targeting regime, revisions in the
monetary policy stance are not an exception, but a rule. Thus, the monetary policy stance
established according to currently available data should not be interpreted as a commitment.
Any unforeseen change in the variables that affect inflation outlook calls for the re-definition
of the monetary policy stance. What is important here is to share openly with the public the
reasons of the monetary policy stance update. As a matter of fact, the Central Bank explains,
via Inflation Reports and other policy instruments, why and how the monetary policy stance
has been reviewed.
The main policy instrument of the Central Bank is short-term interest rates. The
implementation and communication of the monetary policy decisions in the inflation-targeting
regime will continue to be carried out through short-term interest rates. Moreover, as stated
in previous policy documents, instruments such as reserve requirements or efficient liquidity
management might be used, when deemed necessary.
The decision-making process and communication
The Monetary Policy Committee (the Committee) will continue to meet once a month in 2008
as well. Meetings will be held according to the previously set calendar and start at 13.00.
After making a decision, summary of the decision and its rationale will be posted on the
website of the Bank in a press release at 19.00 on the same day. English translation of the
decision will be posted on the website on the same day.
To enhance the communication of monetary policy decisions, "Summary of the Monetary
Policy Committee Meeting" will continue to be posted in both Turkish and English on the
Bank's website within following the meeting.
eight working days
The which is the main communication tool of the monetary policy, will
Inflation Report,
continue to be published quarterly, and the general evaluation of the Report will be presented
to the public with a press conference. The will be published twice a
Financial Stability Report
year1. The report will be published on the following the
"Price Developments" working day
announcement of inflation data.
Beside these communication tools, speeches and presentations made by Central Bank
autorities at the meetings in Turkey or abroad constitute an important pillar of the
communication policy. Working papers, booklets and technical notes published along with
the conferences and workshops organized by the Bank will be used as effective tools for
communication policy.
Exchange rate policy and liquidity management
Exchange rate policy and foreign exhange buying auctions
Along with inflation targeting, the Central Bank will continue to implement floating exchange
rate regime in 2008. As stated in the annual monetary and exchange rate policy
announcements that have been published since 2002, the foreign exchange rate is neither a
target, nor a policy tool in the floating exchange rate regime. Exchange rates are determined
according to the supply and demand conditions in the market. The main factors affecting
foreign exchange supply and demand are the monetary and fiscal policies implemented,
international developments, economic fundamentals, and expectations.
Even if floating exchange rate regime has been adopted, keeping a strong foreign exchange
reserves position is very important in emerging economies like Turkey to eliminate the
unfavorable effects of potential internal and external shocks and to boost confidence in the
country's economy. Moreover, the foreign debt payments of the Treasury should be settled
and remittance accounts that comprise a significant part of the liabilities side of the Central
Bank's balance sheet need to be gradually reduced in the long-term. Therefore, the Central
Bank holds foreign exchange buying auctions to build up reserves at times where foreign
exchange supply increases compared to foreign exchange demand.
With the aim of minimizing the impact on supply and demand conditions in the foreign
exchange market, the Central Bank has been buying foreign exchange via foreign exchange
buying auctions with pre-announced terms and conditions since 1 April 2002 and has been
announcing annual auction programs since 2005. Even if the aim is running the auctions
according to the pre-announced program, in case of significant developments exceeding the
forecasts pertaining to foreign exchange supply, amendments to auction programs can be
made with prior notice.
Thus,
i) The maximum amount to be purchased in daily foreign exchange buying auctions
has been set as USD 45 million for 2007, with USD 15 million for auction amount
and USD 30 million for optional selling amount,
ii) Then, the auction amount has been raised to USD 40 million as of 25 July 2007 with
an assumption that the capital inflow to Turkey will follow a strong trend due to the
end of the election process and positive expectations for macroeconomic policies,
iii) However, the auction amount has been lowered to USD 15 million as of 15 August
2007 due to the fact that the unfavorable developments in housing and credit
markets in developing countries increased the volatilities in the Turkish markets as
well as in other developing markets in the said period.
iv) The measures taken by central banks in order to alleviate the problems in housing
and credit markets have relatively reduced the volatilities in these markets and
increased the global risk appetite. Therefore, the maximum amount to be purchased
in auctions has been set as USD 90 million with USD 30 million for auction amount
and USD 60 million for optional selling amount from 9 October 2007 onwards.
As of 14 December 2007, the total amount of foreign exchange purchased via auctions in
2007 is USD 9.5 billion and there has not been any direct intervention in the foreign
exchange market. The total amounts of foreign exchange purchased and sold by the Central
Bank from 2002 onwards are shown year by year in the table below:
Table 2: The Central Bank's net foreign exchange purchases and sales (2002-2007;
USD million)
FX Buying FX Selling FX Buying FX Selling Total Net FX
Auctions Auctions Interventions Interventions Buying
Year
2002 795 -16 12 799
2003 5,652 -4,229 - 9,881
2004 4,104 -1,283 9 5,378
2005 7,442 -14,565 - 22,007
2006 4,296 1,000 5,441 2,105 6,632
2007* 9,494 -- 9,494
Total 31,783 1,000 25,534 2,126 54,191
* As of 14 December 2007.
Unless extraordinary differences are observed in foreign exchange liquidity conditions,
foreign exchange buying auctions will continue in 2008 with the aforementioned amount that
has been set as USD 90 million maximum with USD 30 million for auction amount and USD
60 million for optional selling amount. However, as was the case before, the developments
related to foreign exchange supply will be closely monitored and in the event of unforeseen
extraordinary developments, the Central Bank may, with prior notice, change the daily
auction amount and/or optional selling amount in both directions and may suspend the
auctions temporarily for shorter and longer periods.
On the other hand, the Central Bank will continue to closely monitor the volatility in exchange
rates also in 2008 and will directly intervene in the market in the event of actual and potential
excessive volatilities.
Banks will also be able to borrow foreign exchange in terms of USD and euro from the
Central Bank within the predetermined limits with a one-week maturity in the Foreign
Exchange and Banknotes Market-Foreign Exchange Deposit Market in the upcoming period.
Moreover, the purchase/sale transactions of "foreign exchange against foreign exchange",
"foreign exchange against foreign banknotes" and "foreign banknotes against foreign
banknotes" conducted between the Central Bank and institutions authorized to operate in the
Foreign Exchange and Banknotes Markets will continue.
In conclusion, within the framework of the current exchange rate regime and the exchange
rate policy of the Central Bank, economic agents should take into account that they operate
in an environment of exchange rate risk and that they should establish mechanisms that will
ensure the efficient management of this risk.
Liquidity management
As an outcome of the Central Bank's foreign exchange purchases, the excess liquidity in the
market continued in 2007, as well. The Central Bank continued to withdraw the excess
liquidity in the market mainly via New Turkish Lira deposit transactions in the Interbank
Money Market within the CBRT and repo transactions in the Repo and Reverse Repo Market
of the Istanbul Stock Exchange, on an overnight basis. However, when the excess liquidity
withdrawn via overnight operations increased, the Central Bank has started to issue liquidity
bills from July onwards in addition to its overnight operations in order to increase the
flexibility and efficiency of liquidity management. Overnight interest rates in the market were
generally around the borrowing rate of the Central Bank, depending on the withdrawal of the
excess liquidity by the Central Bank via overnight operations. Hence, the borrowing rate of
the Central Bank has continued to be an indicator for money markets.
Based on the information currently available,
i) The increase in base money,
ii) Coupon and principle redemption by the Treasury to the Central Bank,
iii) Treasury's being net foreign exchange debt payer,
will have a lowering effect, while;
iv) The Central Bank's net foreign exchange purchases,
v) Interest payments to be made by the Central Bank for required reserves and excess
liquidity absorbing transactions,
vi) The decline in Treasury cash accounts within the Central Bank
will have an increasing effect on the level of the liquidity in the market in 2008.
In view of the Treasury's financing program for 2008 and the Central Bank foreign exchange
buying auction program for 2008, the excess liquidity in the market is expected to continue
generally at reasonable levels in 2008. However, as was the case in previous years, the level
of liquidity in the market may change significantly depending on the changes in Treasury's
financing program as well as in foreign exchange buying amounts of the Central Bank and
changes in Treasury cash accounts within the Central Bank.
As long as the excess liquidity in the market remains at reasonable levels, the Central Bank
will continue to withdraw the excess liquidity in the market on an overnight basis, via New
Turkish lira deposit transactions in the Interbank Money Market within the CBRT and repo
transactions in the Repo and Reverse Repo Market of Istanbul Stock Exchange. Hence,
overnight interest rates will continue to be at the level of the borrowing rate of the Central
Bank. Thus, the overnight borrowing rate of the Central Bank will continue to be the
benchmark interest rate with respect to the monetary policy.
In case of a permanent liquidity shortage in the market, the benchmark short-term interest
rates will not be the borrowing rate of the Central Bank but the average interest rate of the
repo auctions, which is the basic funding instrument. Therefore, in case of tightening in
liquidity, the interest rate taken as a benchmark by the market would have increased merely
due to the decline in liquidity. In order to avoid the negative impacts of such a situation, the
Central Bank could lower its borrowing and lending interest rates - provided that the inflation
outlook is stable - so as to encounter the pressure created by liquidity shortage on overnight
interest rates. However, such an interest rate cut would only mean a technical arrangement
stemming from the change in liquidity conditions. Therefore, such a move should not be
perceived as loosening of monetary policy.
The Central Bank does not foresee any significant changes in the general framework of the
liquidity management for 2008. Accordingly, 2008 liquidity management strategy will be as
follows:
i) The Central Bank will continue to announce overnight borrowing and lending rates
between 10:00-12:00 and 13:00-16:00 in the Interbank Money Market within the
CBRT. In case of a liquidity shortage during the day, banks will be able to borrow at
the Central Bank's lending rate against collateral within their limits. In the event of a
fall in interest rates due to increasing liquidity, banks will be able to lend New
Turkish Lira to the Central Bank at the Central Bank's borrowing rate without any
limit.
ii) The Central Bank extended the transaction hours of Late Liquidity Window Facility
from 16:00-16:30 to 16:00-17:00 and on the last working day of the required reserve
provision to 16:00-17:15 as of July 9, 2007 in order to increase the flexibility and
effectiveness of the liquidity management of banks. The Central Bank will continue
to provide Late Liquidity Window Facility such that banks may borrow from the
Central Bank against collateral, and lend to the Central Bank without any limit within
the hours mentioned above.
iii) In case of a temporary or permanent liquidity shortage, the Central Bank will
continue to carry out its liquidity management through one-week repo auctions.
When there is liquidity shortage in the market, the Central Bank will announce the
amount of repo auction for that day on Reuters' "CBTF" page at 10.00. As long as
no extraordinary fluctuations are observed in the market, the Central Bank, while
determining the amount of the auctions, will endeavor to maintain the average
auction interest rate;
a) At maximum of 1 percentage point above the borrowing rate of the Central
Bank announced for the intra-day transactions to reduce fluctuations in O/N
interest rates, in cases where the liquidity shortage in the market is
envisaged temporary and when the technical interest rate cut explained in
paragraph 45 is not applied,
b) Approximately at the mid point of the O/N borrowing and lending rates of
the Central Bank, in cases where the liquidity shortage in the market is
envisaged permanent and the technical interest rate cut explained in
paragraph 45 is applied.
iv) The weekly repo auctions will be held at 11:00. and the results will be announced on
Reuters' "CBTG" page no later than 11:30.The traditional method will be used in
auctions; in other words, the successful bidders will be evaluated with their own
interest rates.
v) In case of unforeseen excessive liquidity shortage during the day, which would exert
excessive pressure on money market interest rates, the CBRT may announce
"Intraday Repo Auctions" in addition to the regular ones announced at 11:00.
vi) The primary dealer banks will be able to conduct repo transactions within the
framework of open market operations, between 10:00-12:00 and 13:00-16:00.
vii) In case of an excessive increase in the liquidity surplus in the market, mainly the
Central Bank liquidity bills with maturity up to 91 days, and when necessary New
Turkish Lira deposit buying auctions with standard maturities of 1, 2 and 4 weeks
and reverse repo auctions with maturities up to 91 days will be used actively, in
order to enhance the effectiveness and flexibility of monetary policy and liquidity
management strategy. However, the Central Bank will continue to focus on
sterilizing the excess liquidity, which is at such a level that would bring the overnight
interest rates in the money markets close to the Central Bank borrowing rates,
through overnight transactions.
viii) In case of the emerge of extraordinary fluctuations in the market even at reasonable
levels of excess liquidity, the Central Bank may allow the overnight interest rates to
fluctuate between the Central Bank overnight borrowing and lending interest rates
range by sterilizing the excess liquidity drained in overnight transactions through
liquidity bills, New Turkish Lira deposit buying auctions and reverse repo auctions, in
order to reduce the said fluctuations.
ix) In case of the emerge of a need to issue liquidity bills, information on auctions will
be announced at Reuters' "CBTL" page at 10:00 one working day prior to the
auction rather than on the same day, to provide investors a longer time for
evaluation. Information on auctions will continue to be announced to banks and
financial intermediaries by Electronic Fund Transfer (EFT) system. Liquidity bill
auctions will be held at 11:00 with the value date of the following working day, and
the results will be announced until 11:30 at Reuters' "CBTM" page. Auctions will be
held by the traditional method.
x) Information on New Turkish Lira deposit buying auctions will be announced at
Reuters' "CBTY" page; while information on reverse repo auctions will be
announced at "CBTF" p