NBS gross FX reserves hit record-high 22.08 bln euros at end-May

BELGRADE - Increasing by 531.4 mln euros from the previous month, National Bank of Serbia (NBS) gross FX reserves reached 22.088 bln euros at end-May, their highest end-of-month level since records began in 2000.

In a statement, the NBS said the reserves had covered "180 pct of money supply M1 and 5.8 months’ worth of the country’s imports of goods and services, which is almost 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 SBA, and other grounds) also touched their all-time end-of-month high - 18,120.9 mln euros, having increased by 479.7 mln euros from end-April.

The May increase in gross FX reserves reflects primarily NBS interventions in the local FX market on the purchase side (inflow of 375.0 mln euros). Inflows also came from FX reserves management, grants, and other sources (136.4 mln euros in total).

These inflows were more than sufficient to cover the outflows on account of government FX debt repayment and other grounds (152.1 mln euros).

The positive effect of international market factors worth 172.1 mln euros net further boosted FX reserves, mostly as a consequence of the dollar’s strengthening against the euro by around 3 pct. The fall in the global gold price in dollars by around 1.0 pct worked in the opposite direction.

Trading volumes in the IFEM amounted to 678.1 mln euros in May, up by 47.5 mln euros from the month before. In the five months of 2023, IFEM trading volumes totalled 3,288.1 mln euros," the central bank also said.