Turkey may be approaching a familiar reserve management problem. is trading around 48.80 on September 21, pushing toward the 49 level at the same time that the Central Bank of the Republic of Turkey is already reporting another decline in its reserve position. One of the most important questions for both the Lira and markets is therefore becoming harder to ignore: if currency pressure accelerates again, will the CBRT return to the gold strategy it used in March?
There is already a precedent from this year.
During the first quarter, Turkey became the largest reported official sector gold seller. World Gold Council data showed Turkish official sector gold holdings falling by around 70 tonnes, approximately 10% of its official sector holdings at the time, with most of that decline concentrated in March. At the same time, Turkey utilised an additional 80 tonnes through gold swaps for foreign exchange and liquidity purposes. Governor Fatih Karahan later explained that a significant portion of those swap transactions were structured so that the gold would eventually return to reserves.
The important point is therefore broader than simply saying Turkey sold gold. When Turkey experienced serious FX and liquidity pressure, the CBRT demonstrated that it was willing to monetise one of the most liquid assets on its balance sheet to obtain currency liquidity.
That activity slowed dramatically once the immediate stress passed. Turkey sold only around 4 tonnes during the second quarter. July produced another sale of just 1 tonne, taking reported Turkish gold sales for 2026 to approximately 85 tonnes through July.
Now the pressure is beginning to build again.
USD/TRY is around 48.80 today, very close to 49. More importantly, the deterioration is occurring while Turkey’s reserve buffer has already been moving in the wrong direction. CBRT gross reserves fell by roughly $4 billion in the week ending September 4, from about $188.2 billion to $184.2 billion. They then fell another $5.5 billion in the week ending September 11 to $178.7 billion. Net reserves excluding swaps declined from $55.9 billion to $53.4 billion and then to roughly $50 billion over the same two weeks.
That means Turkey lost roughly $9.5 billion of gross reserves in two reported weeks while USD/TRY continued moving higher.
The reserve decline alone does not prove direct currency intervention. Changes in reserves can reflect valuation effects, transactions, swaps and other balance sheet movements. It nevertheless matters because the direction is exactly what investors should watch when a central bank is facing renewed depreciation pressure.
The external environment has also become considerably less comfortable for Turkey. The Federal Reserve has resumed tightening, the dollar index is around 100.23 and Brent crude remains above $100 per barrel. Higher dollar rates increase pressure on emerging market currencies, while expensive oil creates an additional problem for an energy importer such as Turkey.
This leaves the CBRT with several possible lines of defence. It can tolerate continued controlled depreciation. It can use conventional FX reserves. It can tighten financial conditions. State banks can participate in the FX market. The central bank can adjust liquidity conditions and use swaps. Gold becomes particularly interesting when the authorities want additional foreign currency liquidity without exhausting conventional FX reserves too rapidly.
March demonstrated exactly why Turkey’s gold holdings matter.
Gold is not merely a passive reserve asset on the CBRT balance sheet. In a period of financial stress it can effectively become another source of dollar liquidity. Turkey has already demonstrated that it is prepared to sell gold outright and use much larger quantities through gold currency swaps when circumstances require it. The World Gold Council specifically described Turkey’s first quarter activity as tactical and noted previous examples of Turkey using substantial gold holdings during periods of need.
The current situation has not yet reached March conditions. USD/TRY moving from 48.6 to 48.8 in an orderly fashion is very different from a sudden currency run. The CBRT may be perfectly comfortable allowing gradual depreciation, particularly if it believes the move remains consistent with inflation and reserve objectives.
The calculation changes if 49 becomes the beginning of acceleration rather than another level in a controlled crawl.
A move toward 49.50 or 50 accompanied by another large weekly decline in net reserves would leave policymakers with a more difficult choice. Continuing to burn conventional FX reserves would weaken the liquid reserve buffer. Aggressive monetary tightening would impose additional pressure on the domestic economy and financial system. Allowing the lira to depreciate rapidly would risk worsening imported inflation, particularly while oil remains expensive.
Gold would then become increasingly attractive as a reserve management tool because Turkey has already established the operational mechanism and political precedent for using it.
There is another reason the possibility deserves attention from the gold market itself. Turkey has already sold approximately 85 tonnes this year according to reported data through July, yet the overwhelming majority of those sales occurred during the first quarter. Since then, Turkish supply into the official gold market has almost disappeared.
If the CBRT were forced back into a March style operation, the change would therefore be significant. A renewed programme involving tens of tonnes would transform Turkey from a marginal seller back into one of the largest sources of central bank gold supply.
That does not mean a sale is imminent. There is currently no public announcement from the CBRT indicating that another major gold liquidation has been authorised. The argument is instead based on the balance sheet mechanics already demonstrated this year.
Turkey has a weakening currency approaching 49 per dollar. Gross reserves have fallen roughly $9.5 billion across the latest two reported weeks. Net reserves excluding swaps have declined by almost $6 billion. The international environment has become more hostile following renewed Federal Reserve tightening, dollar strength and oil above $100. Meanwhile, the CBRT has already shown in March that gold can be converted into FX liquidity when conventional reserves come under sufficient pressure.
The next reserve reports may therefore become unusually important for gold investors.
If USD/TRY continues its controlled rise while reserves stabilise, there may be little reason for the CBRT to touch its gold stock aggressively. If USD/TRY accelerates through 49 while another several billion dollars disappear from usable reserves, March provides a clear roadmap for what Turkey can do next.
At that point, renewed Turkish gold sales would stop being a theoretical risk and become one of the most logical balance sheet options available to the CBRT.
