The króna ap­pre­ci­ated in Janu­ary, the CBI in­ter­ve­ned twice

The Icelandic króna appreciated against the currencies of our main trading partners in January. The Central Bank (CBI) intervened twice in January, buying euros to counteract the appreciation of the króna.
Seðlabanki Íslands
7 February 2022 - Landsbankinn

At the end of January, the euro stood at ISK 143.2, compared to ISK 147.6 at the end of December; the US dollar stood at ISK 128.4, compared to ISK 130.4 at the end of December. The trade-weighted index increased (the króna appreciated) by 2.6% in January.

The price of the euro dipped below ISK 145 in January for the first time since March 2020, having stayed between 145 and 155 in recent months. We think that the króna is more likely to appreciate further rather than depreciate again in the coming months.

Turnover in the foreign exchange market was ISK 25.2b (EUR 173m) in January and increased somewhat between months. The CBI's share of the month's turnover was ISK 3bn (EUR 21m), or 12% of total turnover.

The CBI intervened twice in January. On Wednesday, 5 January 5, it bought EUR 9m and, on Friday, 28 January, it bought EUR 12m. Both times it was reacting to sharp inter-day appreciation of the króna.

The króna appreciated in January, the CBI intervened twice

You may also be interested in
24 April 2023
Slower rhythm succeeds rapid turnaround
Landsbankinn Economic Research forecasts a cooling of the economy in coming years, despite continued economic growth. Inflation will recede slowly and interest rate levels continue to rise.
Hagspá 2022
19 Oct. 2022
Robust economic growth - purchasing power lags behind
We forecast 6.5% economic growth in Iceland this year, the greatest since 2007. Robust growth in export sectors coupled with strong domestic demand has driven handsome GDP growth in the past year.
New temp image
12 Sept. 2022
Icelandic Economic Weekly: 22 September 2022
Both the number of visitors to Iceland via Keflavík Airport andunemployment numbers are back to pre-pandemic levels.
New temp image
5 Sept. 2022
Icelandic Economic Weekly: 5 September 2022
The inflation rate, measuring 9.7% in August, decreased YoY between months.
New temp image
29 August 2022
Icelandic Economic Weekly: 29 August 2022
The Central Bank of Iceland (CBI) raised interest rates by 0.75 percentage points. The policy rate is now 5.5% and has not been higher in six years.
New temp image
22 August 2022
Icelandic Economic Weekly: 22 August 2022
Market agents expect inflation to peak in Q3 2022 at an average rate of 10%, according to a survey of market agents’ expectations conducted by the Central Bank of Iceland (CBI) in August.
New temp image
15 August 2022
Icelandic Economic Weekly: 15 August 2022
Around 234,000 foreign passengers departed Iceland via Keflavík International Airport in July, departures in July increased about 1.3% compared to July 2019.
New temp image
8 August 2022
Icelandic Economic Weekly: 8 August 2022
After sharp declines in the stock markets recently, the price of shares rose in 19 of the 22 companies listed on the Icelandic stock exchange in July.
New temp image
2 August 2022
Icelandic Economic Weekly: 2 August 2022
Purchasing power in June was 2.9% lower than it was in January 2022, when it had never been higher.
New temp image
25 July 2022
Icelandic Economic Weekly: 25 July 2022
The biggest driver of the rise in the CPI between months in July are airfares, which rose by 19.9%.

By clicking "Allow All", you agree to the use of cookies to enhance website functionality, analyse website usage and assist with marketing.

More on cookies