March 13, 2020 / 10:55 AM / 20 days ago

UPDATE 1-Croatia cenbank sells euros again as kuna remains under pressure

(Adds details, updates exchange rate)

ZAGREB, March 13 (Reuters) - The Croatian central bank said on Friday it had sold 479.55 million euros ($535.32 million) to commercial banks in its third auction this week in a bid to stop deprecation pressures on the national kuna currency.

It said it had sold the euros at an average rate of 7.5649 kuna. The kuna was quoted at 7.5550 to the euro after the intervention. A central bank’s intervention the day before did not stop the easing pressures and the kuna slipped to around 7.60 to the euro.

In the two previous interventions this week the central bank sold 734.8 million euros to commercial banks.

An increased demand for euros in recent days was influenced by dividend payments to foreign investors, but also by a concern about a likely lower inflow of euros in the coming weeks and possibly months amid the coronavirus pandemic.

Croatia strongly relies on hard currency tourism receipts as the sector accounts to almost 20% of the economy.

The central bank keeps the kuna in a managed float regime and usually it fluctuates at between 7.3 and 7.7 kuna to the euro. Croatia wants to adopt the euro in 2023 or 2024. ($1 = 0.8958 euros) (Reporting by Igor Ilic; Editing by)

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