We threw out the hot money, it didn’t even get cold


Since the first half of the year, the financial assets of domestic residents have been defeated by inflation. This defeat is not only in the sense of the return, but also in the base.

From TUIK data for 5 months of the year we know that the performance of the main investment instruments cannot keep pace with inflation. The situation will not change even in June. Because there is no financial instrument that makes a leap in nominal terms.

Over the 6-month period, the highest yields were 29.4% in BIST 100, 25.3% in dollars and 24.4% in grams..

➔However, while inflation increased by 4.95% in June, 6-month inflation increased cumulatively to 42.35%. Therefore, none of the returns could catch up with inflation.

➔The growth in financial assets of domestic residents remained at 32.3% and failed to escape the same result.


➔ Also, in this period Despite the fact that the stock of loans granted nationwide grew by 1.1 trillion and, as a result, TL deposits reached a very rare increase of financial assets were satisfied with a growth of 32%.

➔ Over the same period, this rate of increase fell by 10 points less than the rate of inflation.

➔As you can see from the table opposite, The volume of TL deposits of domestic residents grew by TL 1.1 trillion in 6 months.

➔ Although the decrease in foreign currency deposits plays a partial part in this, The biggest impact came from the similar growth in domestic TL loans.

➔Foreign currency deposits only increased 13.8 on a TL basis due to administrative decisions made. But in dollars, it fell from $ 237 billion to $ 209.8 billion. The decrease is of 27.2 billion dollars and 11.4%.

➔However, the 31 percent increase in total TL and foreign currency deposits was not enough to keep pace with inflation.


The rise in the level of inflation came from equities with 44 percent. This In addition to the average stock valuation of 29%, the increase in the number of domestic investors in the stock market also played a role in the growth.

The number of domestic investors increased by 153 thousand in 6 months and reached 2 million 495 thousand. Its stakes in the shares circulating on the stock market increased from 59.39% to 66.21%.

➔With the effect of 6.82 points and the increase in the valuation of the portfolio the share portfolio of domestic residents went from Lire 525 billion to Lire 756.5 billion.

The search for alternative areas has also increased interest in mutual funds. The total of mutual investment funds, which grew by 45 per cent, rose to 406 billion lire.


As a result, total financial assets exceeded 6 trillion and 169 billion lire at the end of last year. 8 trillion 163 billion lire and increased by 32.3 percent.

➔As the increase is less than inflation, it is difficult to say that there is real and widespread enrichment through financial assets.

However, the situation of those with no financial assets or those with low wealth in the face of inflation has become much more difficult. The distribution of income has further deteriorated.

➔What does not deteriorate and increase is inflation itself.


➔Short-term foreign capital invested in Turkey has not lost its habit in recent years and has continued to sell.

➔The effects of foreign portfolio investments, which we have traced into three main items, contraction of $ 5.6 billion in the first half of the year. We see.

While the share of foreigners fell below 2% in national government debt, it fell to 33% with a 7 percentage point decrease in stocks. The total stock of hot money also decreased from $ 46 billion to $ 40.4 billion.

➔ Foreigners will leave the Turkish market on a net basis starting in 2018. The hot money stock, which had a volume of $ 109.4 billion in 2017, has been in decline for the fifth consecutive year.

Compared to 5 years ago, the drop in inventories is $ 69 billion, or 63 percent.

➔The stock of hot money, which hit a record high of $ 158.5 billion in April 2013, has since continued to decline over the long term. There has been an increase in stocks in just two 10 years.

➔In short “We like the cold of money, not the heat.”And we saw the result. The hot money has run out, but the cold money, which represents foreign direct investment, has not arrived enough.

In order to ensure liquidity in foreign currency, we have come to disrupt the functioning of trade and strangle exporting companies.


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