(Bloomberg) -- Turkey raised the amount of dollars commercial banks can lend to the central bank through currency swap deals, a step intended to boost the nation’s foreign reserves, according to a copy of a directive seen by Bloomberg.

The regulation covers bank foreign-exchange lending to the monetary authority via short-term swaps, which were capped at 20% of their total FX market transaction limits, according to the central bank directive on Tuesday.

The changes will allow commercial lenders to park more of their foreign holdings at the regulator while borrowing liras in return, boosting Turkey’s official reserves.

In the first half of 2019 the central bank boosted the amount of dollars it borrowed though commercial lenders, masking a sudden drawn down in reserves.

The lira trimmed its losses on the news and was trading 0.4% lower at 6.1408 per dollar at 4:53 p.m. in Istanbul.

--With assistance from Constantine Courcoulas.

To contact the reporters on this story: Kerim Karakaya in Istanbul at kkarakaya2@bloomberg.net;Asli Kandemir in Istanbul at akandemir@bloomberg.net

To contact the editors responsible for this story: Onur Ant at oant@bloomberg.net, ;Riad Hamade at rhamade@bloomberg.net, ;Benjamin Harvey at bharvey11@bloomberg.net, ;Taylan Bilgic at tbilgic2@bloomberg.net, Mark Williams

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