Three months of decline for NBR reserves

Foreign currency reserves of the NBR saw their third consecutive decline in April, falling to 21.41 billion euros. Last month, net foreign currency outflows from the reserves of the central bank reached 116 million euros, as compared with 119 million euros in March. This is the longest period of decline in foreign currency reserves witnessed in the last three years. Last summer, the NBR had net outflows from the reserve for two consecutive months, in both May and June. In fact these were the only months in 2006 when foreign currency reserves fell. Foreign currency reserves at the central bank for the February-April period declined a little over 292 million euros in total. According to a NBR release, April saw inflows worth 482 million euros representing revenues derived from the administration of reserves, modifications of minimum compulsory reserves set up by commercial banks and foreign currency transfers to the state reserve. At the end of April, rumours emerged regarding an NBR intervention. The NBR had supposedly purchased foreign currency in order to maintain the exchange rate. However, officials at the central bank rejected these speculations, and with regard to foreign currency inflows made to the reserve, did not comment on making purchases on the foreign market.