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Free liquidity of banks little changed in September

The free liquidity of Hungary's banking sector barely changed in September from the previous month, similar to the previous four months. The stock of two-week National Bank of Hungary (MNB) bonds rose, while the average stock of outstanding foreign exchange swaps and O/N deposits with the central bank dropped, the MNB said on Tuesday.

The average stock of outstanding two-week MNB zero-coupon bonds, the bank's main liquidity-management instrument, rose HUF 172.5 billion to HUF 4,042.1 billion in September after rising HUF 99 billion in August following a decline of HUF 293 billion in July. The average stock of the bonds fell a combined HUF 686 billion between April and July after steady rises of a combined HUF 1,091 billion between December and April.

The average stock of the O/N deposits fell by HUF 21.4 billion to HUF 136.4 billion. Following a drop of 129 billion in August, this was the second decline since a steep HUF 148 billion drop, to HUF 62 billion, in April and combined increases of HUF 225 billion from April to July.

The average stock of forex swaps decreased by HUF 64.3 billion to HUF 400.1 billion after it was practically unchanged in August. The stock of swaps peaked at HUF 362 billion in January 2010, dropped to HUF 87 billion in May and rose sharply both in June and July.

After increases in the previous two months, average deposits of the central government fell HUF 71 billion in August and a further HUF 31.2 billion in September to HUF 1,346.8 billion.

The MNB's average stock of external assets returned to growth, adding HUF 83.3 billion in September to HUF 10,105.5 billion after falling HUF 167 billion in August and rising 116 billion in July. The previous, August drop was the first since last October. The average stock of external liabilities dropped HUF 95.7 billion to HUF 1,285.6 billion after rising just HUF 7.9 billion in August and adding HUF 218 billion in July.

The average current account balance of the banking sector with the MNB only slightly deviated from its reserve requirements, with excess reserves amounting to HUF 0.9 billion after a surplus of HUF 6.6 billion in August which was more than usual.

Average cash in circulation barely changed in September after rising HUF 19 billion to HUF 2,349 billion in August. After dropping in March cash in circulation has risen moderately each month. (MTI-Econews)