The dollar/TL spread between banks and the Grand Bazaar has widened

As demand for foreign currency increases again, statements from the CBRT suggesting that the exit from KKM (FX-protected deposit accounts) is causing this rise have been observed.

Goldman and Barclays economists had previously issued warnings regarding the increase in foreign currency demand.

A significant indicator of the rise in foreign currency demand is the spread between the interbank market and the Grand Bazaar, where it has been observed that the price difference has widened once again.

According to data compiled by Bloomberg, while the dollar/TL closed the day at the 33.88 level in the interbank market on August 21, prices in the Grand Bazaar were at the 34.10 level at the same time. While the interbank-Grand Bazaar spread in dollar/TL rose to 22 kuruş, the difference between the two prices had reached the 23 kuruş level on April 9.

In previous years, during periods of currency shocks, CBRT regulations, and election processes, it was observed that physical demand in the Grand Bazaar increased, and both interbank price differences and buy-sell spreads were seen to exceed 1 lira.

While the dollar/TL is trading at the 33.93 level in the interbank market, it is observed that the buying rate in the Grand Bazaar has risen to the 34.10 levels.