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Serb central bank sells EUR 10mn to support local currency

January 22, 2014

Serbia's central bank (NBS) sold EUR 10mn on the domestic currency market on Monday, January 20 , after selling EUR 60mn on January 17 , to ease the daily volatility of the local dinar currency, the bank said in a statement. Since the start of the year, the NBS has sold EUR 190mn as the local dinar currency started weakening in early 2014 due to the seasonally higher FX demand by domestic enterprises and the US Fed's decision to taper its quantitative easing programme as of January this year, the NBS has said earlier. The dinar traded at 115.72 against the euro on January 21 , up from 115.69 the day before and from 114.64 at end-December 2013 . According to an analysis of Raiffeisen Bank , the depreciation sentiment will sustain during the first quarter of 2014 taking into account the weak credit supply, usually lower private investments flow in this period of the year and rumours of early parliamentary elections. In 2013, total central bank interventions stood at EUR 1.1bn , down from EUR 1.35bn a year ago. The bank's intervention policy was active in both ways - appreciation and depreciation. Since the start of 2013, it bought EUR 615mn and sold EUR 435mn on the domestic interbank market.

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Source: IntelliNews - Weekly Reports

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