26 February 2021

Central Bank to continue regular programme of foreign currency sales

From Monday, 1 March 2021 through the end of the month, the Central Bank of Iceland will sell 3 million euros per business day to market makers in the foreign exchange market, for a total of 69 million euros during the month. The transactions will take place soon after the market opens, and no later than 10:00 hrs. The transactions are in accordance with Press Release no. 30/2020, published on 9 September 2020.

The Bank began selling foreign currency to market makers on a regular basis on 14 September 2020. The objectives of the regular sales programme are to deepen the market and improve price formation. The Bank sold a total of 60 million euros (9.3 b.kr.) in this manner during the month of January. Since 14 September, the Bank has sold a total of 351 million euros (55.7 b.kr.) through the regular sales programme.

At the end of each month, the Bank will announce the amount and planned transaction dates for the coming month’s currency sales. The amount will be based on market conditions at the time in question. The aim will be to keep the scale of the currency sales consistent with normal market functioning. The Central Bank reserves full right to adjust amounts, frequency, and execution of the sales so as to ensure the efficacy of the measure.

Regular currency sales do not affect the Bank’s declared policy of intervening in the foreign exchange market as it deems necessary to mitigate volatility.

Further information can be obtained from Ásgeir Jónsson, Governor of the Central Bank of Iceland, at tel: +354 569-9600.

See press release from 9 September 2020: Central bank to begin regular programme of foreign currency sales.

No. 6/2021
26 February 2021

Back