The average stock of banks’ overnight deposits fell by HUF 101.5 bln to HUF 49.7 bln in July from the previous month.
At the same time, average holdings of two-week NBH bills, the MNB’s main instrument for soaking up excess liquidity, continued to rise. The stock held by residents was up HUF 110.5 bln at HUF 4,591.0 bln and the stock held by non-residents fell HUF 24.9 bln to HUF 423.1 bln.
The last auction of the two-week bills was held on July 30. From August the instrument is being replaced with a two-week deposit that is available only to domestic credit institutions. The central bank said the decline in non-residents’ holdings of the bills suggests they are reducing their stock ahead of the termination of their access to the policy instrument.
The MNB added that monthly average current account balances of the banking sector with the MNB exceeded the reserve requirement by HUF 5.8 bln, which it termed “moderate” compared to the total requirement of HUF 464 bln.
The data show the average stock of external assets and central government deposits both rose in July. However, end-of-month stocks were down as a €1 bln FX government bond matured on July 28. External assets averaged HUF 11,472.2 bln during the month and reached HUF 11,275.6 bln at the end of the month.
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