Date
02/01/2006
Sweden's EU membership entails monthly contributions to the EU's budget. These payments are made in Swedish kronor by the Swedish government and exchanged into euro in the foreign exchange market by a recipient central bank within the EU. Around the end of the year, the EU amount tends to be unusually large, at the same time as liquidity is often thin. For market reasons, therefore, the Riksbank has previously exchanged the EU flow around the end of the year.
The payment this time amounts to SEK 3,369 billion. The Riksbank has again exchanged the krona amount for euro. The transaction has no monetary policy significance. The effect of the foreign exchange transaction on the liquidity in the banking system is neutralised by the Riksbank through an FX-swap.
The Riksbank intends to repurchase the corresponding euro amount in the foreign exchange market within one month of the exchange. This will be done by way of daily morning purchases in accordance with the Riksbank’s usual practice.
