Central Bank raises F/X required reserves, WHY?

Financial Markets Central Bank raises F/X required reserves, WHY? In yet another inexplicable move, Turkey’s Central Bank (CBRT) increased reserve requirements for foreign-exchange deposits by 200 basis points, according… 27 May 2019 In yet another inexplicable move, Turkey’s Central Bank (CBRT) increased reserve requirements for foreign-exchange deposits by 200 basis points, according to a statement on Monday. The measures will withdraw around $4.2 billion of liquidity the market, it […] releasing F/X liquidity to the market. Since the beginning of March CBRT also twice changed its interest rate corridor, switching to the celling rate of 25.5% for OMO to fund banks, only to go back to the official policy rate of 24% within a week or so. It is not  clear at all why CBRT is changing F/X reserve requirements, draining F/X liquidity. It is true that commercial banks are awash in foreign currency deposits, and need TL to extend new loans, where demand is almost exclusively in TL. However, releasing additional TL to the market also raises the specter of new attacks on the TL.  PA Intelligence speculates but can’t prove that the move is intended to help state banks which are obliged to lend up to $5 bn (in TL presumably) to select industries where domestic content can be increased to reduce trade deficits as per economy czar Berat Albyarak2s brand-new IVME (MOMENTUM) loan stimulus package. Yet, the most important ingredient of monetary policy, namely transparency and predictability is completely eroded by these sudden and frequent changes. The exchange rate didn’t react to the news, with the dollar/TL pair closing the day 6.067.