January 4, 2018 / 12:29 PM / a year ago

UPDATE 1-Croatia cenbank buys 405.5 mln EUR to relieve upward pressure on kuna

(Adds quotes, details, updates kuna rate)

ZAGREB, Jan 4 (Reuters) - The Croatian central bank said on Thursday it had bought 405.5 million euros ($489.11 million) from commercial banks in an effort to counter recent upward pressure on the national kuna currency.

It bought the euros at an average rate of 7.4535 kuna per euro. After the intervention the kuna eased a bit, to 7.4300/30 to the euro.

“There was a strong offer of euros on the market by some banks in the last few days and that is what created relatively strong appreciation pressures. I even would have expected the central bank to intervene a day or two earlier,” a dealer at a major local bank said.

In the last 10 days the kuna has firmed from the level of around 7.55 per euro.

“The amount the central bank bought is rather high for the local market, so I would expect the kuna level to stabilise now,” the dealer said.

Last year the central bank stepped in five times to counter appreciation pressures on the kuna, buying a total 947 million euros from banks. The previous intervention took place in mid-December.

$1 = 0.8290 euros Reporting by Igor Ilic; Editing by Catherine Evans

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