Data from the Government Debt Management Agency (ÁKK) show a ten-year GBP 500 million bond expired on March 30.
In a note attached to the data, the MNB said FX transactions, mostly related to the maturing GBP bond, reduced the international reserves by almost €1.2 bln, while redemptions of central bank swap contracts related to the phasing out of retail FX loans, reduced the level of international reserves by €2.9 bln.
It attributed a smaller part of the decline to a fall in ÁKKʼs margin account with the MNB related to cross-currency exchange rate changes. Revaluation effects related to exchange rate changes were among the minor factors affecting the reserves, the MNB added.
The big drop brought the reserves to their lowest level since mid-2009.
The MNB said earlier that it would reduce the level of international reserves as a matter of policy, in conjunction with a decline in Hungaryʼs short-term external debt. Measures that have shifted the financing of government debt to local banks and domestic retail investors, as well as a declining share of FX state debt and the conversion of retail FX loans into forints also support the reduction.
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