In May, the National Bank of Serbia (NBS) reported that net foreign exchange reserves reached EUR 20.97 billion, marking the highest level observed at the month’s end. According to Beta, this figure represents an increase of EUR 50.5 million compared to April.
The majority of inflows into the foreign exchange reserves during May were attributed to NBS interventions, totaling EUR 130 million. This includes EUR 100 million from foreign currency purchases conducted in the last two working days of April, settled in early May, and an additional EUR 30 million from purchases made in May. Furthermore, EUR 75 million from purchases made in the last two working days of May will reflect in the reserves in June, following the standard netting procedure post-transaction.
Gross foreign exchange reserves at the end of May stood at EUR 25.15 billion, the highest level recorded for this point in the month since monitoring began in 2000. This represents an increase of EUR 27.9 million from April. The reserves provide coverage for the money supply M1 at 172.1% and for 6.7 months of goods and services imports, exceeding the adequate standard for foreign exchange reserves coverage.
Inflows were also bolstered by sales of foreign exchange government securities on the domestic financial market, management of reserves, donations, and other sources, totaling EUR 189.4 million. These inflows comfortably offset outflows of EUR 259.4 million from reserves due to state deleveraging in foreign exchange loans and other liabilities, along with EUR 48.7 million from other sources.
Market factors contributed positively to the reserves’ growth by EUR 16.6 million, largely driven by a 1.8% increase in gold prices and a 1.1% depreciation of the dollar against the euro on the international market.
Interbank foreign exchange trading in May amounted to EUR 501.6 million, down EUR 335.5 million from the previous month. Cumulatively, interbank trade for the first five months of 2024 totaled EUR 3.34 billion.
The dinar remained relatively stable against the euro in May, with a nominal 0.1% strengthening since the beginning of the year. During the month, NBS purchased EUR 105 million on the interbank market, bringing its net purchases since the start of 2024 to EUR 635 million, aimed at maintaining stability in the dinar’s exchange rate against the euro.
