(Changes dateline to ANKARA, adds detail, reaction)
ANKARA, Nov 24 (Reuters) - Turkey is still talking with the International Monetary Fund on a new loan accord and no agreement has been reached on the volume of the credit, government sources told Reuters on Monday.
Turkish newspaper Zaman reported earlier that the government had accepted an offer from the IMF for a $19 billion credit line to help Turkey deal with the effects of the global financial crisis.
"Technical discussions with the IMF are continuing. We have made significant progress but we are yet to reach the final stage, and it is not true to speak of a figure on the volume of credit now," one government source told Reuters.
Another government source, who also declined to be identified, confirmed that the size of any deal had yet to be agreed.
Turkey is not under the same financial strains that have forced other emerging markets countries to seek IMF aid, but has begun to see a sharp slowdown in its $700 billion economy and its currency has lost a third of its value in two months.
The lira rose 2.5 percent against the dollar on Monday, boosted by foreign market gains and expectations the government will announce an economic stimulus package this week.
The government is working on steps, including raising the government guarantee for bank deposits, to ease access to credit and curb rising unemployment.
"The government support package is in the making, so within this week we can expect to have some good news, and that is being priced in now," said analyst Burak Urucu of Meksa Invest.
Under normal conditions the amount of money that the IMF would offer a country in Turkey's position would be $15 billion but the global lender raised its offer to $19 billion during negotiations with Ankara, Zaman newspaper said. Turkey had asked for $30 billion, the daily said.
Turkey has not decided whether it will opt for a regular stand-by deal, which has more strings attached, or a precautionary deal, Zaman said. No further details were immediately available, but the government has repeatedly said it prefers a precautionary deal that does not give Turkey funds automatically but allows the government to draw money on merit.
Last week senior ruling AK Party sources told Reuters Turkey is set to agree to a deal with the IMF that will allow it to draw $20-40 billion in funds if needed.
BUSINESS CALL FOR DEAL
Prime Minister Tayyip Erdogan has said he expected further progress on the IMF issue this week. The IMF office in Ankara was not immediately available to comment.
Turkey's last $10 billion regular stand-by loan accord, the latest in a series of loan programmes which helped it emerge from a 2001 financial crisis, expired in May.
Economists say Turkey's $74 billion foreign exchange reserves are no longer a large enough a buffer, given Turkey has more than $100 billion of external debt falling due over the next 12 months and an estimated current account deficit of around $35 billion for 2009.
The Turkish government is reluctant to accept big spending curbs and other painful steps that might exacerbate the economic slowdown ahead of municipal elections in March.
A precautionary deal would leave the government more flexibility on spending, as would a higher growth estimate.
The IMF wants budget plans for 2009 to be based on a more conservative growth estimate than the government's 4 percent forecast, according to economists.
Turkey is still under IMF surveillance because it owes the global lender around $9 billion. An IMF delegation visited Turkey last month for post-programme monitoring talks. (Additional reporting by Thomas Grove; Editing by Ruth Pitchford)