Denmark’s government now has no foreign currency debt – for the first time in 183 years

Jon Banking, Economy, Geopolitics, Government

Denmark’s central government paid back the entirety of all its foreign currency loans for the first time in “at least 183 years,” the country’s central bank said on Monday.
“On 20 March 2017, the Danish central government will repay its last loan in foreign currency, totalling 1.5 billion dollars. Thus – for the first time in at least 183 years – the Danish central government has no foreign currency loans,” a statement from the Danmarks Nationalbank said.
The government had previously undertaken foreign loans to ensure that it could keep its foreign exchange reserves at adequate levels. However, reserves have plunged in recent years, meaning that no more loans have been taken, allowing existing ones to be repaid.
FX reserves have shrunk thanks to huge interventions in the market from the central bank in order to keep the Danish krone pegged to the euro, which have drained the reserves.
Denmark’s central bank makes clear that Monday’s news does not mean it is without any debt, just that all debt it has is now denominated in Danish currency.

This post was published at Business Insider