The NBS Head Office Building was built from 1888 – 1890, on the basis of blueprints designed by Konstantin Jovanovic (Vienna 1849 – Zurich 1923), son to distinguished artist Anastas Jovanovic...
On Monday, 23 March, the NBS will hold an additional FX swap auction to supply dinar liquidity to the banking sector for a period of three months at a favourable interest rate of 0.85%.
By buying foreign exchange (euros) for dinars in this swap auction, the NBS aims to support the domestic financial system and economy amid the spread of the coronavirus (COVID-19).
The NBS stresses that neither dinar nor FX liquidity of the domestic banking sector are threatened, and that there are ample liquidity buffers (excess liquidity) to sustain the normal functioning of the financial system. The decision to hold an additional EUR/RSD swap was adopted as part of the NBS measures during the emergency state declared in the Republic of Serbia because of COVID-19 and reflects the intention to provide additional support to the domestic financial system and overall economic flows.
FX swap auctions are a regular instrument the NBS may use to regulate dinar and FX liquidity of the banking sector. Additional EUR/RSD swap auctions organised by the NBS in the first half of 2019 proved exceptionally effective – they contributed to maintaining stability in the money market amid a temporary slump in excess dinar liquidity.
As so far, the NBS will keep a close eye on banking sector liquidity and movements in the domestic financial market, ready to hold additional FX swap auctions if necessary, as well as to use all other instruments at hand, in order to ensure smooth functioning of the local financial system in an environment of heightened uncertainty and risks caused by the COVID-19 contagion.