June 27, 2019 / 1:04 PM / 3 months ago

Turkey's cenbank plans to cut FX reserve requirement upper limit -bankers

ANKARA, June 27 (Reuters) - Turkey’s central bank plans to decrease the upper limit for the foreign currency maintenance facility within the reserve options mechanism, two bankers told Reuters on Thursday.

“The central bank plans to decrease the upper limit for the FX maintenance facility within ROM,” one banker said who asked not to be named. “This will increase foreign currency liquidity in the market while it will decrease lira liquidity.”

The central bank did not comment.

In May, the central bank lowered a foreign exchange maintenance facility within its so-called reserve options mechanism (ROM) to 30% from 40% to support financial stability.

The move in May provided $2.8 billion of FX liquidity to the market, the bank said, whereas 7.2 billion lira would be withdrawn. (Writing by Ezgi Erkoyun; Editing by Jonathan Spicer)

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