Turkey and the United Arab Emirates announced on Wednesday they had signed a $4.9 billion swap deal in local currencies, as the Turkish authorities seek means to boost the deteriorating local currency, which lost 44% of its value against the dollar last year.
The three-year agreement, struck in local currencies, reflects the intentions of both countries to repair their fractured relations.
The size of Wednesday’s swap agreement in local currencies is AED18 billion or 64 billion Turkish liras, according to separate statements by both monetary authorities.
It's worth noting that Turkey has previously signed similar deals with Qatar, South Korea and China worth around $23 billion, in an attempt to bolster the Turkish lira that lost around 40% of its value in December 2021 alone, when investors fled lira assets seeking protection against a worsening inflation outlook.
The lira was trading down 0.5 percent at 13.6 per dollar at 12:30 p.m. local time in Istanbul.