Croatia’s central bank allocates no funds at regular weekly repo auction

Today was held the eighteenth regular weekly auction, in which the HNB did not allocate funds as no bids were submitted, latest data reveal. Local sources have said before that this is on account of too high costs but we also note that liquidity has been abundant as of late even if lending has been steadily growing in transaction-based terms. The weekly repo auctions were launched in September 2015 with the objective to inject short-term liquidity in the system, following the requirements of the adopted CHF-loan conversion legislation. The interest of banks was high in the first months but then it slowly faded out and in the past year banks have been asking for funds only in the summer months when demand for local currency increases in the peak of the tourist season.

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