Turkey Draws Down Gold as War Bites
Turkey’s gold leaves reserves to defend the lira
Turkey has drawn down about $8 billion from its gold reserves since the start of the war around Iran, creating one of the most closely watched stories in bullion markets this month. Bloomberg reported on March 26 that Turkish reserve sales had become an additional source of pressure on bullion. Two days earlier, Bloomberg said Ankara was considering broader use of its gold stockpile as part of a lira defense strategy in response to Iran war-related volatility.
Barron’s, citing Julius Baer analyst Carsten Menke, said Turkey has sold roughly 54 tonnes of gold since the conflict began in order to stabilize the lira. At late-March prices, that amount is broadly consistent with the $8 billion figure in Bloomberg’s report. What matters is not only the volume, but the signal. Gold, usually treated as a defensive asset during geopolitical stress, is being liquidated to generate liquidity and support a currency under pressure.
Why Turkey started selling gold from reserves
The immediate trigger is pressure on the lira after the external shock from the Iran war. Bloomberg reported on March 24 that Turkey’s central bank had discussed an expanded defensive toolkit, including gold-for-foreign-currency swap transactions in London. That would allow the authorities to mobilize hard currency quickly without relying on a single intervention channel.
Official data from the Central Bank of the Republic of Turkey support the broader picture. In its International Reserves and Foreign Currency Liquidity Developments release for March 6, 2026, the bank said official reserve assets fell 6.1% from the previous month to $197.5 billion. Gold holdings within reserves declined 1.5% to $134.7 billion. That is effectively in line with Bloomberg’s estimate of about $135 billion in gold reserves at the start of March.
Turkey has long treated gold as more than a passive reserve asset. The World Gold Council places the country among the largest official gold holders globally. Trading Economics, citing IMF-based reserve data, says Turkey’s gold reserves fell from 641.28 tonnes in the third quarter of 2025 to 613.70 tonnes in the fourth quarter. That means the stockpile had already started to decline in physical terms before the March shock intensified market attention.
How the Iran war changed the role of gold
The current episode is unusual because gold did not behave as a straightforward safe haven. Several market reports in late March noted that bullion came under pressure partly because some central banks were being pushed into selling gold in order to defend currencies and manage domestic financial stress. Barron’s explicitly linked extra pressure on the gold price to Turkish reserve sales. The Wall Street Journal separately reported that gold was still about 13% below prior highs before staging a partial rebound.
For Turkey, this mechanism is especially powerful. The economy remains sensitive to imported energy costs, and higher oil prices together with weaker risk appetite toward emerging markets feed quickly into the exchange rate, inflation expectations and financing conditions. In that environment, gold becomes a tool of currency defense rather than a symbolic insurance asset sitting untouched in the reserve book.
What the gold drawdown means for Turkey
Even after the recent sales, Turkey still holds a large gold stockpile. Bloomberg’s estimate of roughly $135 billion at the start of March and the central bank’s official reading of $134.7 billion on March 6 show that policymakers are not yet operating from a position of reserve exhaustion. Instead, they appear to be using part of a sizable buffer to absorb an external shock.
Still, the market is focused on the precedent. Barron’s reported that Julius Baer sees involuntary gold sales as more destabilizing than ordinary reserve rebalancing because they are driven by necessity rather than asset-allocation choice. That makes Turkey’s actions relevant far beyond Ankara. For investors, this is not just a domestic Turkish macro story. It is now part of the global pricing story for gold in 2026.
What this means for Turkey’s economy and investors
Selling gold does not solve Turkey’s deeper structural vulnerabilities, but it can ease short-term pressure on the lira and help create foreign-currency liquidity. Bloomberg’s March 24 report made clear that the authorities are treating gold as part of a broader defense mechanism rather than as a stand-alone solution. That is consistent with Turkey’s long-running habit of using reserves, market operations and regulatory tools in combination during periods of stress.
The longer the regional conflict lasts, however, the more politically sensitive the strategy may become. Gold reserves are often seen domestically as a symbol of monetary sovereignty. If a temporary response turns into a prolonged drawdown, the question will shift from whether the policy works in the short term to how deeply Turkey is willing to use one of its most visible reserve assets. That is why Bloomberg’s report resonated so strongly: it showed that the Iran war is not only reshaping oil and currency markets, but also affecting bullion through central-bank behavior.
How Turkey compares with Georgia
Georgia presents a very different story. It is not a major player in global gold reserves and it is not defending its currency through such large-scale bullion operations. Instead, the country’s current investment case is being driven by growth, tourism and a different risk profile. Geostat reported that Georgia’s real GDP grew 7.5% in 2025. The Georgian National Tourism Administration said international traveler visits reached 7.8 million in 2025, international tourist visits totaled 5.52 million and tourism revenue rose to $4.69 billion.
Those trends matter for real estate, especially in the premium segment. Research on Georgia’s hospitality and resort markets shows that the country is still building out higher-end and branded supply, including in Batumi. That points to a market where parts of the luxury and upper-premium segment have remained supply-constrained relative to rising tourism and investor interest. In other words, while Turkey is using gold to defend macro stability, Georgia is still monetizing a growth story built on visitor inflows and underdeveloped high-end stock.
The safety perception is also different. The 2025 Global Terrorism Index from the Institute for Economics and Peace shows Georgia with a zero score for terrorism impact. That does not eliminate all risk, but it does place the country in a fundamentally different perception bracket from Turkey, which is now being affected directly by the regional fallout of the Iran war and by financial-market pressure.
That is why the comparison with Georgia is not artificial. Turkey remains much larger and more liquid as an economy, but it is currently forced into reserve defense. Georgia is smaller and less liquid, yet offers a more straightforward growth narrative through GDP expansion, tourism inflows, a calmer risk backdrop and continued gaps in luxury supply.
As International Investment experts report, Turkey’s gold drawdown matters not just for currency and commodity traders, but also for global property and private-capital investors. It shows how quickly a geopolitical conflict can turn a reserve asset into an emergency stabilization tool. Against that backdrop, Georgia looks like a smaller but calmer growth story, where strong tourism, fast GDP growth, relative safety and a shortage of high-quality luxury supply support a very different investment logic based on deployment of capital rather than emergency defense of it.
FAQ
Why is Turkey selling gold from its reserves?
Because policymakers are trying to support the lira and create foreign-currency liquidity in response to volatility linked to the Iran war.
How much gold has reportedly been sold already?
Barron’s, citing Julius Baer, said Turkey has sold about 54 tonnes of gold since the war began, roughly equivalent to $8 billion at late-March prices.
How much gold did Turkey still hold in early March?
Bloomberg estimated about $135 billion, while the Turkish central bank’s March 6 reserve report showed $134.7 billion in gold holdings.
Why does this affect the global gold market?
Because forced selling by central banks adds supply and puts pressure on bullion prices even during geopolitical stress.
How is Georgia different in the current environment?
Georgia is not under the same scale of reserve pressure, while posting 7.5% GDP growth, strong tourism numbers and a calmer perceived risk environment, with parts of its luxury segment still undersupplied.