## Foreign Currency Balance Sheets in Türkiye: Exposure and Interconnectedness

_IMF Working Papers, June 23, 2023_

## Source details

**Canonical URL:** [Foreign Currency Balance Sheets in Türkiye: Exposure and Interconnectedness](https://www.imf.org/en/publications/wp/issues/2023/06/23/foreign-currency-balance-sheets-in-trkiye-exposure-and-interconnectedness-534737)

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## Bibliographic details
- Authors: Alex Pienkowski
- Published: June 23, 2023
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798400245879.001

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### Summary
- Author: Alex Pienkowski
- Date: June 23, 2023
- Series: Working Paper No. 2023/132
- Pages: 15
- Core summary: As a heavily “dollarized” economy, large foreign currency mismatches exist between institutional sectors within Türkiye, as well as with non-residents. Combining several separate data sources, this working paper builds a picture of the aggregate FX exposure of the total economy and explores the interlinkages between sectors and how they have evolved in recent years.
- Key historical change: Since the start of the pandemic, the overall net FX position of the economy deteriorated, and there has been a considerable shift in FX risk from the private to the public sector. Especially for the central bank, this shift constrains policy space.

### Major findings and statistics
- Large foreign currency mismatches exist between institutional sectors within Türkiye and with non-residents.
- The paper constructs aggregate FX exposure of the total economy by combining several separate data sources.
- Since the start of the pandemic:
  - The overall net FX position of the economy deteriorated.
  - There has been a considerable shift in FX risk from the private sector to the public sector.
  - The shift in FX risk notably constrains the central bank's policy space.

### Themes and technical focus
- Aggregate FX exposure and balance sheets
- Interlinkages across institutional sectors and with non-residents
- Evolution of FX risk allocation since the start of the pandemic
- Implications for central bank policy space and public sector balance sheets
- Subject classifications: Financial statements, Foreign exchange, Public financial management (PFM)
- Keywords provided: aggregate FX exposure, balance sheets, Currency risk, Financial statements, foreign currency balance sheets, FX position, FX risk, Global, position of the economy, Türkiye

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- **Working Paper**
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_Source: https://www.imf.org/en/publications/wp/issues/2023/06/23/foreign-currency-balance-sheets-in-trkiye-exposure-and-interconnectedness-534737_