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Croatian national bank selling euro reserves to preserve Croatian kuna exchange rate

Xinhua, February 21, 2015 Adjust font size:

Croatian National Bank (HNB) reacted on Friday to the falling of Croatian kuna exchange rate by selling 172.7 million euros (196.7 million U.S. dollars) at an average exchange rate of 7.71 kuna for one euro.

With this move, HNB had withdrawn around 1.32 billion kuna from the market in order to keep the exchange rate at 7.72 kuna for one euro. This rate of kuna to euro is the highest since May 2000.

HNB made a similar move on 22nd of January, when it sold 326.2 million euros (372 million dollars) at a rate of 7.69 kuna for one euro. With that move, HNB withdrew 2.5 billion kuna.

While high exchange rates for kuna are profitable for Croatian exporters, they are having extremely bad effects on imports, tourism and loans connected to the euro exchange rate. Endit