MNB allots HUF 25 bln at EUR/HUF swap tender

Telco

jessica fejos

The National Bank of Hungary (MNB) allotted HUF 25 billion of one-month forint swaps against euros at a tender on Monday, central bank data cited by state news wire MTI show.

A single bank bid EUR 80 million (HUF 25 bln) in the tender. The MNB had offered HUF 50 bln of the one-month swaps, as well as HUF 50 bln of three-month swaps, but no bids were received for the latter.

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.

The tender on Monday brings the total stock of the swaps to HUF 900 bln, including HUF 75 bln of one-month, HUF 425 bln of three-month, HUF 250 bln of six-month and HUF 150 bln of twelve-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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