Serbian Dinar Slides Further, Dealers Unsure If C-bank Will Intervene

“There was no central bank intervention but there might be one. The dinar/euro exchange rate was stable but at a certain moment the dinar lost ground to 89.90-90.00. It firmed now [1035 GMT] at 89.30-89.80,” a local dealer told SeeNews, quoting Tuesday's close of 89.00-89.50 dinars per euro.

“I expect there will be an intervention if it eases to 89.90 again,” the dealer said. “Yesterday's intervention was big, so the bank might refrain from the market today if the dinar does not fall beyond 90.00 [to the euro].”

The central bank, NBS, sold 60 million euro ($78 million) in several interventions on Tuesday, in support of the falling dinar, after it touched a historic low of 89.50 per euro.

The large demand for euro continues to weigh, another local dealer told SeeNews, quoting a dinar/euro rate of 89.50 at 1135 local time (1035 GMT) versus last trade of 88.80 on Tuesday. “It weakened to 89.00 at the opening today and has been below that level all morning.”

“There hasn’t been a central bank intervention yet,” the second dealer said. “It is possible to see one as we had the bank stepping in regularly during the past days.”

On Monday, NBS sold 30 million euro to prop up the local currency after it reached 89.30 per euro.

Last week, NBS injected 120 million euro in the market to support the dinar, which touched a historic low of 89.00 per euro.

($=0.7703 euro)