Why are foreign currency deposits increasing?

The Central Bank of the Republic of Turkey (TCMB) has published an analysis evaluating recent developments in foreign currency deposits. The analysis states that the increase in foreign currency deposits is largely due to changes in parity and gold prices. However, it was noted that when adjusted for these effects, there was a limited increase in shifts from Currency-Protected Deposit (KKM) accounts to foreign currency and gold investments.

The analysis was prepared by Didem Güneş, Ayşe Karasoy, and Oğuzhan Evli and published on the TCMB's blog page. The report indicates that despite the rapid rise in gold prices, the share of TL deposits continues to remain at historical average levels, suggesting that households and companies are maintaining their preference for TL assets.

It was emphasized that the nominal increase in foreign currency deposits in 2025 is directly related to the rise in gold prices and changes in the euro/US dollar parity. While the price of an ounce of gold was around 2,600 US dollars at the end of 2024, it reached levels of 4,000 US dollars in 2025. During the same period, the euro/dollar parity rose from 1.04 to 1.16. These changes accounted for a significant portion of the increase in foreign currency deposits.

With the termination of KKM accounts, the rate of conversion from these accounts to foreign currency has also increased. In particular, the conversion rate to foreign currency exceeded 80 percent in August and October. This increase was due to the higher foreign currency tendencies of depositors. With the large-scale closure of KKM accounts, no steps such as targets for shifting to TL were taken to keep the conversion rate to foreign currency limited.