Additional EUR/RSD Swap Auction Organised
Today, for the second time in 2019, the NBS organised an additional two-week swap auction, where in the first leg it bought from banks foreign exchange – euros for dinars. In this auction, which is one of the standard instruments for regulating dinar and foreign exchange liquidity of the banking sector, the NBS swap bought EUR 110.5 mn at weighted average swap points of 1,091.
In today's auction, the NBS supplied banks with dinar liquidity in the amount of RSD 13.1 bn for a period of 14 days.
To enable the banking sector to gradually adjust to improved liquidity in the money market, and having in mind the maturing of prior additional swap auction (Wednesday, 13 February), the NBS organised today a new, additional FX swap auction. The realisation, however, was lower than in the previous auction.
The previous additional swap auction, held on 28 January (when the NBS supplied banks with dinar liquidity in the amount of RSD 22.5 bn in exchange for EUR 190 mn for a period of two weeks) has served its purpose improving liquidity of the banking sector and ensuring smooth functioning of the interbank money market. The central bank’s proactive approach has helped prevent potential segmentation of the interbank money market and a potentially more significant rise in short-term interest rates.
As so far, the NBS will keep a close eye on movements in the domestic financial market and react when necessary in order to ensure its smooth functioning.