HUF liquidity of the banking sector declined in June, the National Bank of Hungary (NBH) commented on its balance sheet data. Overnight deposits and other bank deposits at the NBH declined during the month. The NBH supported bank liquidity through the fine-tuning forex swaps and the stock of swaps rose significantly in June. The average stock of fine-tuning swaps amounted to HUF2,055.3bn during the month, up by 14.6% m/m. Banks continued to maintain relatively high excess reserves at the central bank, amounting to HUF20.1bn in June. Total reserve requirements of the banking sector stood at HUF210.1bn for the month.
External assets of the NBH amounted to HUF8,553.7bn on average in June and increased by 2.9% m/m. The increase was partly on account of the forint weakening, the NBH explained. Conversely, external assets were down m/m in terms of end-of-month stocks, which was due to the expiration of a government Eurobond during the month. Central government deposits increased in terms of average monthly stocks but expectedly declined at the end of the month due to the Eurobond repayment and the budget deficit in June.