EUR/DKK propped up by intervention – Danske Bank

Jens Pedersen, Senior Analyst at Danske Bank, noted the recent FX intervention by the DN to support DKK.

Key Quotes

“In June, the FX reserve in Denmark rose to DKK452bn, from DKK427bn in May, as Danmarks Nationalbanken (DN) sold DKK25bn in FX intervention”.

“It marks the second consecutive month with a rising FX reserve. DN sold DKK49bn in FX intervention in total in May and June. Government deposits were DKK172bn in June, up from DKK159bn in May”.

“EUR/DKK traded at a low level in June, which prompted DN to sell DKK in FX intervention to cap EUR/DKK downside, while IPO revenue contributed to the rise in government deposits”.

“DN further comments that ‘the majority of the interventions took place prior to the United Kingdom’s referendum on 23 June on European Union membership’.