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MNB allots HUF 150 bln at EUR/HUF swap tenders

Telco

The National Bank of Hungary (MNB) allotted HUF 150 billion of one- and 12-month forint swaps against euros at a tender yesterday, data released by the central bank shows, Hungarian news agency MTI has reported.

The MNB allotted HUF 100 bln of one-month swaps. Eight banks bid EUR 435 million (HUF 133 bln) in the tender.

The MNB also allotted HUF 50 bln of 12-month swaps. Bids from the six banks participating at the tender came to EUR 395 mln (HUF 121 bln).

The central bank introduced the tenders for the FX swaps last fall as a "fine-tuning instrument" for market liquidity after it put a cap on placements in three-month deposits, its main sterilisation instrument.

The tender on Monday will raise the total stock of the swaps by HUF 50 bln to HUF 900 bln, including HUF 300 bln of one-month, HUF 300 bln of three-month, HUF 200 bln of six-month and HUF 100 bln of 12-month swaps.

The MNB said it continuously observes liquidity trends and stands prepared to hold further tenders for the instruments if it sees "substantial and lasting" deviations.

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