By Orhan Coskun
ANKARA, April 10 (Reuters) - Turkey has held talks with the United States about possibly securing a swap line from the Federal Reserve and has discussed other funding options to mitigate fallout from the coronavirus outbreak, Turkish officials said on Friday.
While Ankara is keen to secure funding from the U.S. central bank if possible, the officials said Turkey is not at the same time considering pursuing a deal with the IMF given what they called negative domestic perceptions of working with the Fund.
Analysts have raised concerns that a draw-down in foreign reserves could hamstring Turkey's response to the pandemic, heightening the need for foreign funding. The measures taken to halt the spread of the COVID-19 disease are expected to tip the economy into its second recession in less than two years.
Underscoring the sensitivity of the issue, the Turkish lira rallied 2% on Thursday after International Monetary Fund Managing Director Kristalina Georgieva said it will continue constructive engagement will all members including Turkey.
The Fed has ramped up its swaps lines - in which it accepts other currencies in exchange for dollars - to central banks in several countries including Brazil, South Korea and Mexico to backstop global financial markets amid the crisis.
Turkey - a NATO ally that has nonetheless been at loggerheads with Washington on several fronts in recent years - is not among the recipients.
"There has been top-level contact between the two countries regarding the swap," a senior Turkish official told Reuters, referring to Turkey and the United States. "Turkey views this matter positively, if it is possible."
A second Turkish official said: "A Fed swap line is quite attractive and can be considered as an option."
"Aside from the IMF, Turkey is looking at every kind of option for resources and is involved in various contacts," the person said under condition of anonymity.
Turkey's Treasury Ministry was not immediately available to comment, nor was the U.S. Treasury. The Fed did not immediately comment.
(Reporting by Orhan Coskun; Writing by Daren Butler; Editing by Jonathan Spicer)