Central Bank of Turkey Initiates Turkish Lira-Settled Forward FX Sales to Stabilize Currency Markets

The Central Bank of the Republic of Turkey (TCMB) has officially launched Turkish Lira-Settled Forward FX Sales (NDF) to mitigate volatility in the foreign exchange markets. This move, announced on March 25, 2025, aims to alleviate pressure on the exchange rate by fixing the exchange rate for a specific period. At maturity, parties will settle the difference in Turkish Lira without physical exchange of foreign currency. This approach seeks to reduce exchange rate pressure and enhance predictability in the market. The action follows recent fluctuations in currency markets and is viewed as a critical intervention to balance foreign exchange demand and ease pressure on the Turkish Lira.