MNB Bonds Soak up Banking Sector Liquidity in December 

MNB

Average stock of bonds issued by the National Bank of Hungary (MNB) rose to HUF 700 billion in December from zero in the previous month, monthly data released on Friday show, according to a report by state news wire MTI.

The central bank said the increase in swaps providing euro liquidity as well as the smaller decline in the average stock of O/N and variable-rate deposits also point to an increase in forint liquidity of the banking system.

The average stock of O/N deposits fell HUF 287 bln to HUF 4.664 trillion in December. The average stock of variable-rate deposits dropped HUF 464 bln to HUF 2.135 tln.

MNB launched daily tenders for fixed-rate O/N deposits, at a rate of 18%, well over the 13% base rate, in mid-October.

The December data show banks' had HUF 2.801 tln on their reserve accounts during the month, up from HUF 2.778 tln in November.

Currency in circulation averaged HUF 8.411 tln in December, up HUF 125 bln from November.

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