Norwegian Krone and Danish – new currencies in the foreign exchange reserve | Realtid.se

The Riksbank Board of Directors has taken a decision on a new financial and investment risk policy that defines the gold and exchange reserve management framework. The new policy implies that the Norwegian and Danish kroner should also be included in the foreign exchange reserve in order to better meet the urgent foreign exchange needs of the Riksbank.

The new policy will come into effect on January 1, 2019, writes the Riksbank in a press release.

"Swedish banks currently have liquidity needs mainly in US dollars, euros, pounds sterling and Norwegian and Danish kroner, so that the composition of foreign exchange reserves better reflects the currencies that the Riksbank needs for preparation purposes. , the Executive Council decided that from next year, foreign exchange reserves would also contain assets in Norwegian and Danish kroner, "writes the Riksbank.

It is still very important that banks have mainly sufficient liquidity reserves to manage the risks they incur. This is why the Riksbank believes that the Financial Supervisory Authority should impose requirements on the Swedish Bank's liquidity coverage ratio (LCR) in banks' core currencies.

Assuming that the foreign exchange reserve meets the readiness requirements of the Riksbank mission, the Riksbank will also consider sustainability aspects and will now develop appropriate methods for including them in the management of the foreign exchange reserve.

Like most other central banks, the Riksbank has a gold and currency reserve. It allows the Riksbank to provide foreign currency loans in the event of a crisis. In this way, one can mitigate the effects of a financial crisis and prevent its spread to society as a whole.

Gold and foreign exchange reserves also enable the Riksbank to intervene in the foreign exchange market for monetary and monetary policy purposes. It also contributes to the Riksbank's meeting its international commitments, such as the IMF and other central banks.

The Riksbank Board of Directors decides each year on the regulatory framework defining the management framework for gold and foreign exchange reserves. The new financial risk and investment management policy will begin on January 1, 2019. The composition of foreign exchange reserves will change from January to March 2019.

The new financial and investment risk policy will replace existing policies, the financial risk policy and the investment policy for gold and foreign exchange reserves.