Foreign Exchange and Liquidity and Monthly Balance Sheet, January 2021

Authors Danmarks Nationalbank
Subject Press releases from Danmarks Nationalbank
Type Press Releases  
Year 2021
Published 2 February 2021
Abstract icon ​In January 2021, the foreign-exchange reserve decreased by kr. 11.4 billion to kr. 427.6 billion.

THE FOREIGN-EXCHANGE RESERVE

In January 2021, the foreign-exchange reserve decreased by kr. 11.4 billion to kr. 427.6 billion. The decrease reflects Danmarks Nationalbank's net sale of foreign exchange for kr. 1.4 billion, and the central government's net repayment of foreign debt for kr. 10.0 billion, cf. table 1.

In January, Danmarks Nationalbank has not intervened in the foreign exchange market.

Danmarks Nationalbank's net foreign-exchange purchases and the change in the foreign-exchange reserve - table 1

Kr. billionJanuary 2021
Danmarks Nationalbank's interventions* to purchase foreign exchange, net0.0
Other**-1.4
Danmarks Nationalbank's net foreign-exchange purchases-1.4
The central government's net foreign borrowing***-10.0
Change in the foreign-exchange reserve-11.4

Note: Details may not add because of rounding and previously published figure may have been revised. All transactions as per settlement date.

* Intervention takes place when Danmarks Nationalbank purchases and sells foreign exchange for Danish kroner in the foreign-exchange market in order to stabilise the exchange rate.

** Comprises e.g. interest accrued on the foreign-exchange reserve, the central government's net payments in foreign exchange, and changes in the banks' deposits in euro-denominated accounts at Danmarks Nationalbank.

*** Including net payments to the central government in foreign exchange as a result of currency swaps

VALUE ADJUSTMENT OF DANMARKS NATIONALBANK'S PORTFOLIOS FOR 2020

Danmarks Nationalbank has calculated annual value adjustments of its holdings in connection with the preparation of the annual report for 2020.

As a result of value adjustments, etc. the foreign exchange reserve has decreased by kr. 0.6 billion and amounts to kr. 439.0 billion at end-2020. Similarly the holdings of domestic bonds have decreased by kr. 0.3 billion and amount to kr. 32.9 billion at end-2020.

The monthly balance sheet is a liquidity statement, the purpose of which is that the net liquidity changes of the monetary-policy instruments as well as of the size of the foreign exchange reserve can be read directly from the balance as changes during the period. Thus the monthly balance sheet does not include value adjustments or accruals, which are solely included in Danmarks Nationalbank's annual report.

DEVELOPMENT IN LIQUIDITY

In January, the central government's net financing requirement amounted to kr. -24.2 billion, cf. table 2.

The net position of the banks and mortgage-credit institutes vis-à-vis Danmarks Nationalbank decreased by kr. 21.4 billion in January, to an outstanding amount of kr. 142.6 billion. In January, the central government's liquidity impact decreased the net position by kr. 19.5 billion.

Impact of various factors on the net position of the banks and mortgage-credit institutes via-a-vis Danmarks Nationalbank - table 2

Kr. billionJanuary 2021
The central government's net financing-24.2
Redemption on domestic central-government debt*15.9
Net bond purchases by the government funds and own portfolio and financing of social housing6.4
Other**-0.1
The central government's gross domestic financing requirement-2.0
The central government's gross domestic borrowing***17.5
The central government's liquidity impact-19.5
Danmarks Nationalbank's net foreign-exchange purchases-1.4
Danmarks Nationalbank's net bond purchases0.1
Other factors****-0.5
Change in net position-21.4

Note: Details may not add because of rounding and previously published figure may have been revised. All transactions as per settlement date.

* Including krone-denominated payments by the central government in currency swaps.

** Comprises, inter alia, net bond purchases by the government funds and net collateral for the government’s swap portfolio.

*** Gross long-term borrowing, net short-term borrowing and krone-denominated payments to the central government in currency swaps.

**** Comprises e.g. changes in banknotes and coins in circulation.

DANMARKS NATIONALBANK'S INTEREST RATES

Since 6 July 2012 the discount rate has been 0,00 pct. p.a., since 1 June 2012 the current-account interest rate has been 0,00 pct. p.a., since 20 January 2015 the lending rate has been 0,05 pct. p.a. and since 20 March 2020 the rate of interest on certificates of deposit has been -0,60 pct. p.a.

Enquiries can be directed to press advisor Ole Mikkelsen on tel. +45 3363 6027.

BALANCE SHEET OF DANMARKS NATIONALBANK 31 JANUARY 2021

Assets 2021 2020
1000 kr.31/0131/12
Stock of gold24,535,62621,672,570
Foreign assets383,225,145395,729,288
Claims on the International Monetary Fund22,240,50523,543,443
Claims related to banks' and mortgage credit institutes' TARGET accounts in ECB28,12636,536
Monetary-policy lending5,000,000-
Other lending3,507,9663,931,681
- Banks'1)3,507,9663,931,681
- Miscellaneous loans--
Domestic bonds32,984,20433,233,788
Financial fixed assets, etc.130,748130,748
Tangible and intangible fixed assets720,476680,132
Other assets2,909,7091,108,172
475,282,505480,066,358

1) Other lending to banks include loans for cash deposits. In addition, the item includes balances with Danish banks in connection with swap agreements with central banks. The claim amounts to kr. 2.2 billion.

Liabilities 2021 2020
1000 kr.31/0131/12
Banknotes67,980,87468,389,053
Coins6,143,4396,134,283
Monetary-policy deposits147,568,777164,003,464
- Current accounts30,210,77729,568,464
- Certificates of deposit117,358,000134,435,000
Other deposits9,737,6499,280,252
- Deposits related to banks' and mortgage credit institutes' TARGET accounts in ECB28,12636,536
- Other deposits from banks' and mortgage credit institutes'1,711,8301,517,598
- Miscellaneous deposits 2)7,997,6937,726,118
Central government146,452,398136,875,182
Foreign liabilities2,443,3531,344,478
Counterpart of Special Drawing Rights allocated by the IMF (SDR)13,415,55414,137,490
Other liabilities1,754,993116,688
Capital and reserves79,785,46879,785,468
475,282,505480,066,358

2) The balance sheet item includes balances in connection with swap agreements with central banks. The deposits amount to kr. 2.2 billion.

Note: The monthly balance sheet is calculated at beginning of year values +/- accumulated transaction values. The monthly balance does not include value adjustments and accruals, as these are only calculated at year-end, cf. Danmarks Nationalbank's accounting principles.