NBS gross FX reserves at 28.113 bln euros at end-July

BELGRADE - National Bank of Serbia (NBS) gross FX reserves reached 28,113.3 mln euros at end-July, their highest level since monitoring began in 2000, the central bank said on Friday.

The reserves were up by 606.8 mln euros relative to the previous month, the NBS said in a statement.

"They covered 185.9 pct of money supply M1 and 7.4 months’ worth of the country’s imports of goods and services, which is more than twice the level prescribed by the adequacy standard.

Net FX reserves (gross FX reserves less banks’ FX balances on account of required reserves, liabilities to the IMF under the arrangement, and other grounds) also came at a record high – 23,913.3 mln euros, up by 642.9 mln euros from end-June.

The key boost to FX reserves in July came from the NBS interventions in the amount of 465.0 mln euros, which is the result of a 240.0 mln euro FX inflow from FX purchases executed on the last two business days in June and settled in early July (the usual settling of two business days after the transaction), as well as the net FX purchase in July in the amount of 225.0 mln euros. Inflows also came from the NBS’s FX reserves management, grants and other sources (159.6 mln euros in total).

These inflows were more than sufficient to offset the outflows on account of the net settlement of government FX loan and other liabilities (48.7 mln euros) and outflows on other grounds (90.5 mln euros in total).

FX reserves were also propped up by the positive net effect of market factors worth 121.4 mln euros, mainly reflecting the rising price of gold by around 4.1 pct, while the dollar’s weakening against the euro by around 1.3 pct in the international market worked in the opposite direction," the NBS also said.