Hungarian international reserves increase by 0.3% m/m at end-August

International reserves of the National Bank of Hungary (NBH) amounted to EUR22.4bn and rose by 0.3% m/m at end-August, according to NBH data. In USD-denominated terms, reserves were up by 1.7% m/m to USD26.6bn at the end of the month. The increase interrupted the stable downward trend in the past few months but we expect it to be temporary, given the NBH swap operations and its policy geared towards gradual reduction of reserves. In EUR terms, reserves have declined by 8.3% ytd as of end-August while they were up by 3.0% ytd in USD terms, which we think reflects the recent depreciation of the US dollar.

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