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Central bank interventions soared in March as weak-crown policy neared end
May 9, 2017 / 8:58 AM / 6 months ago

Central bank interventions soared in March as weak-crown policy neared end

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PRAGUE, May 9 (Reuters) - The Czech central bank bought 19.26 billion euros from the market in March, a record monthly size of purchases of foreign currency as the bank’s policy of keeping the crown weak drew to an end, data showed on Tuesday.

Investors piled into the crown, believing it would jump once the bank dropped the weak-crown regime as a step toward tightening of monetary conditions. It ended the interventions on April 6.

In total, the central bank bought 75.23 billion euros from the market since the policy was introduced in November 2013, boosting its foreign currency reserves to 124.46 billion euros in April, about 70 percent of gross domestic product.

The large long positions in the crown have prevented any sharp firming so far, with the crown trading at 26.695 to the euro at 0845 GMT on Tuesday, just 1.1 percent firmer from the former intervention level. (Reporting by Jan Lopatka; Editing by Keith Weir)

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