The foreign exchange reserves of the National Bank of Serbia (NBS) stood at EUR 10.23 billion at end-March, up by EUR 443.9 million from end-February, the NBS announced yesterday.
This level of gross FX reserves covered 191% of money supply (M1) or more than five months’ worth of the country’s imports of goods and services, almost twice the level prescribed by the standard on the adequate level of coverage of imports of goods and services by FX reserves.
Net FX reserves (FX reserves less banks’ FX balances on account of required reserves and other requirements) came at EUR 8.46 billion at end-March, up by EUR 474 million from end-February, or by more than half a billion (546 million) euros from end-January.
The considerable increase in gross FX reserves in March mostly resulted from inflows from NBS activities in the domestic FX market, i.e. FX purchases amounting to EUR 405 million, which further strengthened the resilience of the domestic financial system to potential shocks from the international environment, the central bank said.
A boost also came from net inflows arising from FX securities and FX loans (EUR 98.1 million in total), grants, FX reserve management and other grounds (EUR 51.3 million in total).
– These inflows exceeded significantly the outflows from FX reserves on account of FX required reserves of banks and other grounds (EUR 85 million total), and fully offset the negative impact of market factors (EUR 25.5 million net total), mainly the changes in cross-currency trends in the international financial market – the NBS points out.
Trading volumes in the IFEM amounted to EUR 842.8 million in March, up by EUR 291.8 million from the month before. In the first three months of 2018, interbank trading volumes reached EUR 2.28 billion.
In March, the dinar depreciated against the euro by 0.3% in nominal terms, and the NBS intervened in the IFEM by purchasing EUR 400 million in order to ease excessive short-term volatility of the exchange rate.
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