Serbia's Foreign Currency Reserves Decrease to €27.39 Billion by End of May
The National Bank of Serbia reports a decline in gross foreign currency reserves, maintaining coverage above international standards.
As of the end of May 2023, the gross foreign currency reserves of the National Bank of Serbia stood at €27.3989 billion, representing a decrease of €306.5 million compared to the end of April.
This level of reserves provides coverage for the monetary aggregate M1 at 166.7% and equates to 6.6 months of imports of goods and services, which significantly exceeds the internationally accepted standards for reserve coverage.
The net foreign currency reserves, which are calculated by subtracting the foreign currency assets of banks based on required reserves, obligations to the International Monetary Fund under arrangements, and other liabilities from the gross reserves, amounted to €23.0637 billion at the end of May. This reflects a decline of €270 million from the previous month.
Outflows from the foreign currency reserves occurred due to net government debt repayments concerning foreign currency loans and payments of other foreign currency obligations totaling €350.1 million.
Additional outflows included net interventions by the National Bank of Serbia in the domestic foreign exchange market amounting to €60 million and net withdrawals of foreign currency reserves by banks totaling €19.6 million.
In terms of inflows, the foreign currency reserves were bolstered by donations, management of reserves, and other factors, yielding a net increase of €94.7 million.
Additionally, a positive net effect from market factors of €28.5 million was attributed to movements in international markets, primarily driven by a 0.2% strengthening of the U.S. dollar against the euro.
During May, the volume of forex trading on the interbank foreign exchange market reached €537.6 million, which is €201.3 million lower than the previous month.
Cumulatively, in the first five months of the year, total transactions in the interbank foreign exchange market amounted to €3.4249 billion.
As of May 2023, the exchange rate of the Serbian dinar against the euro remained relatively unchanged, although there has been a nominal depreciation of the dinar by approximately 0.2% against the euro since the beginning of the year.
Furthermore, the National Bank of Serbia net sold €90 million on the interbank foreign exchange market in May. Since the start of the year, the central bank has net sold €1 billion to maintain relative stability of the dinar's exchange rate against the euro.
This level of reserves provides coverage for the monetary aggregate M1 at 166.7% and equates to 6.6 months of imports of goods and services, which significantly exceeds the internationally accepted standards for reserve coverage.
The net foreign currency reserves, which are calculated by subtracting the foreign currency assets of banks based on required reserves, obligations to the International Monetary Fund under arrangements, and other liabilities from the gross reserves, amounted to €23.0637 billion at the end of May. This reflects a decline of €270 million from the previous month.
Outflows from the foreign currency reserves occurred due to net government debt repayments concerning foreign currency loans and payments of other foreign currency obligations totaling €350.1 million.
Additional outflows included net interventions by the National Bank of Serbia in the domestic foreign exchange market amounting to €60 million and net withdrawals of foreign currency reserves by banks totaling €19.6 million.
In terms of inflows, the foreign currency reserves were bolstered by donations, management of reserves, and other factors, yielding a net increase of €94.7 million.
Additionally, a positive net effect from market factors of €28.5 million was attributed to movements in international markets, primarily driven by a 0.2% strengthening of the U.S. dollar against the euro.
During May, the volume of forex trading on the interbank foreign exchange market reached €537.6 million, which is €201.3 million lower than the previous month.
Cumulatively, in the first five months of the year, total transactions in the interbank foreign exchange market amounted to €3.4249 billion.
As of May 2023, the exchange rate of the Serbian dinar against the euro remained relatively unchanged, although there has been a nominal depreciation of the dinar by approximately 0.2% against the euro since the beginning of the year.
Furthermore, the National Bank of Serbia net sold €90 million on the interbank foreign exchange market in May. Since the start of the year, the central bank has net sold €1 billion to maintain relative stability of the dinar's exchange rate against the euro.
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