The International Monetary Fund says that Denmark’s Nationalbank (the country’s central bank) has gained credibility after forcefully fighting back the onslaught – Bloomberg is writing this morning. It’s a rare example of monetary authorities prevailing against the market says Bloomberg.
In January and February, Denmark’s Nationalbank’s interventions totaled kr. 275 billion, and monetary policy interest rates were gradually reduced to a historic low. This was done by policy makers in order to make it clear that the peg to the Euro would stand and making it clear that it would be unprofitable to speculate against it.
The USD / DKK exchange rate is 6.935 at 8.50am this morning.