With HUF 25 bln of one-month swaps expiring, the tender will raise the total stock of swaps by just HUF 15.7 bln, to HUF 1,275.7 bln.
The tender was the fourth since central bank policy-makers decided to raise the MNBʼs stock of forint swaps against euros while assigning greater importance to the maturity structure of the stock with the aim of providing “the loosening effect up to the longest possible section of the yield curve as soon as possible.”
The MNB offered HUF 25 bln of one and three-month EUR/HUF swaps on Monday. Demand focused on the one-month swaps, where the central bank accepted all the HUF 40.7 bln bids it received from four banks. It refused the HUF 6.2 bln bid arriving from one bank for the HUF 25 bln of three-month swaps on offer.
The MNB did not offer either six or twelve-month swaps at the Monday tender.
The total stock of swaps will now comprise HUF 179 bln of one-month, HUF 324 bln of three-month, HUF 273 bln of six-month, and HUF 500 bln of twelve-month swaps at the value date on October 18.
The central bank introduced the tenders for the FX swaps last autumn as a “fine-tuning instrument” for market liquidity after it put a cap on placements in three-month deposits, its main sterilization instrument.
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