Serbian Foreign-Exchange Reserves Fall to 9.96 Billion Euros

Serbia’s foreign-exchange reserves fell to 9.96 billion euros ($13.88 billion) in June as the country repaid debt to domestic and foreign creditors.

Foreign-exchange reserves fell by a net 97.3 million euros after Serbia repaid 67.8 million euros to locals whose savings were frozen in the early 1990s and which the government pays through a so-called savings bond, the National Bank of Serbia said in an e-mail today.

Serbia also repaid 48.7 million euros to foreign creditors, while banks withdrew 20.6 million euros from their mandatory reserve accounts, kept with the central bank. Inflows included 47.7 million euros raised by the government in the local market and 5.7 million euros worth of donations, the bank said.

Net reserves, excluding the funds commercial lenders keep with the central bank and funds from the International Monetary Fund, increased to 5.4 billion euros from 5.39 billion euros in May, the Belgrade-based Narodna Banka Srbije said.

That level of the reserves matched 426 percent of M1 money supply, seven months of goods and services imports and 984 percent of Serbia’s short-term debt, the bank said.

Interbank trading volumes rose in June to 2.06 billion euros, increasing by 381.9 million euros from May, while the January through June interbank trading volumes hit 8 billion euros, it said.

The dinar weakened 5.4 percent against the euro in June, while remaining 3 percent stronger against the common European currency this year so far, according to the bank.

The central bank sold 30 million euros in June in interbank foreign-exchange market to smooth excessive dinar daily swings, it said.

To contact the reporter on this story: Gordana Filipovic in Belgrade at gfilipovic@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net

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