International reserves down again, approaching 2010 levels


The National Bank of Hungary (MNB) released data today on the state of the country’s international reserves, figures which show a third consecutive month of decrease both year-on-year and month-on-month.

At the end of July 2013, Hungary’s international reserves totaled €33.73 billion according to the statistics, representing a drop of €595 million from June and an overall decrease of €2.161 billion from the €35.894 billion recorded by MNB in April; the reserves had peaked in 2013 at €35.897 billion in February.

The mark also represents a decrease year-on-year from the €35.899 billion in international reserves noted in July 2012.

Cited for the July decrease was the government’s decision to repay early some €2.2 billion remaining on the International Monetary Fund loan issued in 2008 ahead of the maturity date. The repayment is expected to reduce Hungary’s international reserves to 2010 levels. At the end of that year, MNB placed the country’s total reserves at €33.674 billion.

While the European Central Bank (ECB) approved the upcoming integration of the Hungarian Financial Supervisory Authority (PSzÁF) with the MNB earlier this week, noted at that time that the ECB’s 2012 Convergence Report had specified that MNB’s foreign reserve management was “incompatible with Treaty [and the Statute of the European System of Central Banks] requirements.” ECB authorities are apparently hoping that the MNB-PSzÁF merger will help mitigate risk associated with said management.

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