Denmark's foreign exchange reserves, a monetary policy tool, fell to 459.0 billion Danish crowns ($84.82 billion) in March from 475.4 in February the central bank said on Wednesday. The bank said it did not intervene in the foreign exchange market in March to steady the crown. Changes in the forex reserves are a pointer to interest rate setting if they stem from central bank intervention in the market because such action by the bank tends to precede changes in interest rates.
European Union member but euro zone outsider Denmark's policy of holding the crown steady against the euro means that the central bank shifts interest rates for the sole purpose of keeping the crown around its central parity of 7.46038 per euro.
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