Turkish lira hits historic low sparking gold rush in Istanbul Grand Bazaar
September 30, 2020
Finance

Turkish lira hits historic low sparking gold rush in Istanbul Grand Bazaar

ISTANBUL (TURKEY) – Last week, Istanbul resident Hasan Ayhan took his savings on the instruction of his wife to buy gold at the city’s historic Grand Bazaar. This comes as Turks bought the yellow metal worth $7 billion in a just a fortnight.

The retired policeman was among many others who decided to play it safe with memories of a currency crisis that rocked the country two years ago fresh in their minds. As he waited in queue in the covered market, a screen showed the gold price rise by one Turkish lira ($0.1366) in 10 minutes.

“I think it is the best investment right now so I converted my dollars to buy gold,” said the 57-year-old, adding: “I might withdraw my lira and buy gold with it too, but I am scared to go to the bank right now because of coronavirus.”

A day after Ayhan purchased gold, the lira hit a historic low and exposes concerns that the country’s reserves have been badly depleted by market interventions.

According to Mehmet Ali Yildirimturk, deputy head of an Istanbul gold shops association, his countrymen have traditionally used gold as savings and there may be as much as 5,000 tonnes of it “under mattresses”.

Gold vendors at the Grand Bazaar said there are only buyers for bullion and no one comes to sell ornaments.

“I’ve been chatting with hundreds of people who are thinking about selling their cars or houses to invest in gold,” said gold merchant Gunay Gunes.

With selling gripping the lira over the past three weeks, local holdings of dollars and gold jumped $15 billion to reach a record $220 billion.

(Photos syndicated via Reuters)
This story has been edited by BH staff and is published from a syndicated field

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