24.10.08

Denmark raises key interest rate to defend crown

The Danish central bank said on Friday it raised its key lending rate for the second time this month to support the Danish crown and indicated it was prepared to continue to raise rates to defend its currency.
...
"This is a textbook intervention for a fixed currency regime. We've intervened in the market first before lifting interest rates," Central Bank spokesman Karsten Biltoft told Reuters, without saying how much of its reserves the bank had used. "We'll continue to go by the textbook in the future."
Nationalbanken has no inflation or money supply target but adjusts rates and intervenes in the currency market for the sole purpose of keeping the crown stable against the euro.
http://www.guardian.co.uk/business/feedarticle/7918232

No comments: