One in 10 central banks uses FX swaps to defend currency
Interventions were relatively common in past year, suggesting greater activity in spot market
Only about one in 10 central banks use foreign exchange swaps or similar derivatives to defend the currency, the Reserve Benchmarks 2024 show, despite many intervening in FX markets over the past year.
Among 51 central banks that supplied data in this area, five institutions (9.8%) use swaps at times to intervene in FX markets – though not necessarily in the past year. Some of the five mentioned using similar types of derivatives, such as non-deliverable forwards (NDFs), instead of swaps.
Of the
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