It is now costing the banks even more to deposit money into Nationalbanken. After the latest interest cut, it costs the banks 75 øre for every 100 kroner, they are depositing in Nationalbanken. The Nationalbank’s decision to cut rates (which is the 4th time in less than 3 weeks) was done following the decision by the Swiss National Bank to discontinue the minimum exchange rate and the decision by the European Central Bank to launch an expanded asset purchase programme, there has been a considerable inflow of foreign currency.
The Director of the Nationalbank Lars Rohde continues: “There is no upper limit to the size of the foreign exchange reserve. The sole purpose of the monetary policy instruments is maintaining a stable krone exchange rate against the euro. The revenue of Danmarks Nationalbank is positively affected by the increase of the foreign exchange reserves.”
Danmarks Nationalbank’s interventions in the foreign exchange market amounted to kr. 106.3 billion in January and 3 days ago the bank had 564.1 billion kroner in foreign exchange reserves.